Strategy (formerly MicroStrategy) announced on Monday that it had spent 1.25 billion dollars to purchase 13,627 bitcoins, which is its largest purchase in six months. The latest purchases have focused on the range between 88,000 and 92,000 dollars, and this area is still considered increasingly important as a psychological support level for investor sentiment.
If Bitcoin drops clearly below this level, MSTR faces an immediate downside pressure risk as sentiment weakens and the valuation gap narrows.
Does spending behavior set a market comparison value for MSTR?
After MicroStrategy's most recent purchase, its Bitcoin reserves have risen to 687,410 BTC. After the announcement, there were no significant changes in the company's stock. At the time of writing, MSTR's price was around $162.
Since December, Strategy has made seven separate Bitcoin purchases. The average purchase price varied slightly, ranging from a low of $88,210 to a high of $92,098.
These repeated purchases at the same level have formed an anchor point for traders. Small price fluctuations have begun to serve as a benchmark for future purchases.
As a result, investors will likely monitor whether Strategy continues buying at this level. A clear drop below this price could weigh on sentiment and keep MSTR's stock price volatile in the short term.
The narrowing of the premium tests investors' confidence
Strategy's stock often behaves like a leveraged Bitcoin position, as investors see it as a proxy for BTC exposure rather than a traditional software company. The company's financing model can reinforce this dynamic.
Strategy continues to finance its Bitcoin purchases by issuing securities. This works well when the stock trades at a premium. However, if the premium narrows, financing could become more challenging.
Previously, the company has made purchases below the current $88,000 level. Although a prolonged drop below this level would not automatically force Strategy to sell its holdings, investor sentiment toward the market could change.
Shareholders may begin to view Strategy's recent purchases as less like disciplined accumulation and more like an attempt to buy at a price level that Bitcoin struggles to surpass. This could weigh on sentiment and affect the stock's premium relative to its Bitcoin holdings.
This premium is significant because it influences how investors assess the potential dilution risk.
If MSTR weakens relative to Bitcoin, future capital raising could become even less attractive to current shareholders. In this scenario, the market may reassess the pace and sensitivity of Strategy's buying program to Bitcoin's price level.
In practice, this could increase MSTR's stock volatility. The risk is highest when Bitcoin tests recent lows or moves through key technical levels.
