While “boring” Bitcoin has been trading sideways since March, Bitcoin agency MicroStrategy is trading at its highest levels since 2019 relative to the flagship cryptocurrency. “Like (MicroStrategy) there is an opportunity to exit and continue climbing, but the stock is overbought in the short term. He recommends a Bitcoin hedge. MSTR BTC.CM= 2024 YTD Bitcoin and MicroStrategy Performance” for a once high-flying asset The lack of enthusiasm in the category is one of the factors that has kept us more defensive and risk-off as of late,” he said in a note on Wednesday. “Many crypto-related stocks such as MARA, COIN, and RIOT have shown the same performance. Additionally, MSTR has rebounded to highs over the past few weeks.” “Compared to BTC, the stock is at its highest level since 2019 ,” Ginsburg added. However, “the ratio between the two has become severely overbought. Previous conditions have resulted in pullbacks. We believe it might not be a bad idea to tactically hedge MSTR’s recent gains with BTC,” he said. He added that Bitcoin’s price action over the past seven months has been “just boring,” with a low of about $55,000 and an upper limit of $70,000. Recently, it was consolidating near the lower $60,000 level. Wolf said the flagship cryptocurrency is overdue for a retest of support near $50,000. Bitcoin is up 41% this year, while MicroStrategy is up 193%. The fourth quarter tends to be a strong quarter for risk assets, and many investors expect Bitcoin to rebound before the end of the year. MicroStrategy, which tends to be a high beta for cryptocurrencies, is expected to follow. —CNBC’s Michael Bloom contributed reporting.
