- MicroStrategy stock could rise over 100 percent in the coming months, says an executive and a veteran investor.
- Other factors back the optimistic outlook.
- Microstrategy remains highly dependent on Bitcoin price fluctuations.
YEREVAN (CoinChapter.com)- MicroStrategy, a business intelligence company heavily invested in Bitcoin, has seen its stock value decline after CEO Michael Saylor purchased an additional $177M-worth of the alpha crypto on August 23.
However, MSTR is about to soar, asserted Bob Loukas, the founder of Big League Finance, a financial products-development firm, and the Financial Tap, an educational platform for traders.
What’s in store for MSTR?
Mr. Loukas analyzed the MSTR stock price and noticed a bottoming pattern dubbed “inverse head and shoulders” (iHS). In detail, the pattern entails three consecutive bottoms, with the lowest one in the middle, which is the ‘head.’ The other two bottoms on either side are the ‘shoulders.’
The highs of the pattern, where both the shoulders and the head initiate, can be connected with a line called the neckline (orange on the chart below). The iH&S is a bullish reversal pattern, meaning the uptrend should begin after the second shoulder crosses the neckline.
The chief strategist outlines his approximation for the upcoming price action, which could bring MicroStrategy shares north of the yearly high ($1,315). The estimation is over 100 percent higher than the current price ($702 per share).
While the target price does look ambitious, other economic factors back the bullish outlook.
MicroStrategy and Bitcoin
MicroStrategy is one of the leading companies in the software application industry. In a study to determine the strength of various stock performances, the MSTR stock scored 46, which means it is “stronger” than 46 percent of the stocks on the market.
Additionally, it scored 74 in the software application industry. It entails that MicroStrategy performs better than 74 percent of public companies in the field. Moreover, the business intelligence company is heavily invested in Bitcoin, which depends on the alpha crypto.
The MSTR stock rose by 29 percent at the beginning of August. In addition, it gained high traction, as Bitcoin put on over 70 percent since July 21.
Over the past ten years, machine learning analysis of stock price trends suggests a 65 percent chance for a near-time rise. However, as MicroStrategy is the largest Bitcoin investor company, the previous research might not prove relevant should Bitcoin price drop. The business intelligence company currently owns 108,992 BTC coins, which the company acquired over one year.