Shares of MicroStrategy Inc. (MSTR), the enterprise software firm that has pivoted to holding Bitcoin (BTC), are exhibiting some of their most active technical signals in months, according to market analyst Jamie Coutts. This week, Coutts pointed to a cluster of indicators forming around the $195 level, suggesting a potential trend reversal for the company as Bitcoin stabilizes after a period of volatility. This moment is crucial not only for MicroStrategy but for market sentiment as a whole, as major institutions are starting to view the firm’s performance as a barometer for Bitcoin’s future direction.
Technical Signals Form Around a Key Support Zone
Coutts highlighted a “capitulation-style” volume coupled with the formation of a hammer candle, a technical setup frequently observed near the end of significant selling pressure. He emphasized that this combination is often a precursor to market reversals. The analysis also noted overlapping indicators, such as DeMark levels and shifting momentum, converging around the $195 mark. Coutts points out that above this threshold, a thin volume band extends up to approximately $285, opening the possibility for a sharp upward movement should buyer interest return.
“Even the MSTR/BTC ratio is starting to show fatigue after a long stretch of underperformance,” commented Coutts.
Market Sentiment and JPMorgan’s Insight
This perspective aligns with a recent analysis from JPMorgan, which noted that the short-term trajectory of Bitcoin may depend on whether MicroStrategy can maintain its enterprise-value-to-Bitcoin ratio above 1. Currently hovering around 1.13 and supported by a substantial cash reserve of $1.44 billion, the firm appears well-positioned to weather market fluctuations. JPMorgan has indicated that if MicroStrategy secures its spot in the MSCI index after the review on January 15, Bitcoin could see a rebound, estimating a mid-term fair value near $170,000.
A Company at the Center of Crypto Market Cycles
MicroStrategy’s growing prominence within the cryptocurrency landscape is taking shape as its strategic approach evolves. Reports indicate that the company has significantly reduced its Bitcoin purchases, from a peak of 134,000 BTC in 2024 to a mere 9,100 BTC in November 2025. This shift hints at a more cautious strategy, diverging from its previous “buy every dip” mentality.
Changing Strategies Amid Market Challenges
In light of these changes, analysts argue that the market may have unfairly penalized MSTR stock. A recent report by CryptoQuant analyst Carmelo Alemán pointed out that the stock now resides in a “rare historical undervaluation zone.” Alemán calculated that the implied value of MicroStrategy’s holdings, approximately 650,000 BTC, acquired at an average cost of about $74,400, exceeds the company’s current market capitalization by roughly 78%. With the stock trading around $186, it remains significantly below its 52-week peak of $457.
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