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With Bitcoin price taking a dive under $50,000 earlier today, there’s going to be a similar reaction in MSTR price moving forward.
After the massive sell-off taking place in the crypto market, public-listed cryptocurrency firms have been facing selling pressure in the early trading hours on Monday. The world’s biggest corporate holder of Bitcoin MicroStrategy Inc (NASDAQ: MSTR) has seen its stock price collapse by a massive 18% in pre-market trading.
MicroStrategy (MSTR) Stock Movement
Last Friday, August 2, the MicroStrategy (MSTR) stock ended 4.2% in the negative thereby slipping under $1,500. The stock price has further crashed under $1,250 levels in the pre-market trading hours on Monday. As a result, the MSTR loss on the weekly chart has extended to more than 35%.
Ever since MicroStrategy gained exposure to Bitcoin in September 2020, its fortunes have been closely tied to the Bitcoin movement. With the Bitcoin price taking a dive under $50,000 earlier today, there’s going to be a similar reaction in the MSTR price moving forward.
Despite the correction in the pre-market hours, the MicroStrategy (MSTR) stock price is still up by over 85% since the beginning of 2024. As we know, Japan’s Nikkei Index has corrected by a staggering 13% today, marking it the biggest single-day fall since the 1987 Black Monday crash for Wall Street.
Besides, the US futures market is already a major pullback with the top three indices falling by nearly 2-5%. Tech companies are facing a major rout with Nvidia falling by 9% in Monday pre-market while Apple Inc. collapsing 8%.
Amid the growing fears of a US recession and a hard landing, the US Treasury Yields tanked as investors searched for safety in bonds. On Friday, the benchmark 10-year note yielded 3.76%, a significant decrease from the previous week’s 4.20% and the lowest yield in a year.
Crypto Firms Bleed on Wall Street
Apart from MicroStrategy, other publicly listed crypto firms have been facing the same brunt. Coinbase (NASDAQ: COIN) share price is down by a massive 15% in the pre-market trading hours slipping all the way to $170. As a result, it has extended its weekly drop to more than 30% as of now. This comes despite Coinbase reporting $1.4 billion in Q2 revenue last week.
A crash of a similar magnitude is also visible in some of the crypto-mining firms. The stock of Marathon Digital (NASDAQ: MARA) and others have collapsed more than 16% in Monday’s pre-market session.
Once the #Ethereum and #Bitcoin ETFs open for trading @CNBC will no longer be able to sugar coat the magnitude of the decline. That's because those drops will included the losses from Saturday. If ETF investors sell instead of buy, liquidations could overwhelm the spot markets.
— Peter Schiff (@PeterSchiff) August 5, 2024
Shares of spot Bitcoin ETFs and spot Ethereum ETFs will also be on the radar on Monday. Economists like Peter Schiff are expecting a 30% drop for them later today.
