ChainCatcher news, according to CoinDesk, analysts explain the recent stock price trends of MicroStrategy (MSTR) through Soros' Theory of Reflexivity. This theory posits that there is a bidirectional interaction between investor expectations and prices: optimistic investors drive prices up, which allows companies to finance at lower costs, further improving performance and pushing prices higher, creating a virtuous cycle. However, when this cycle is broken, price adjustments may exceed market expectations.
The stock price of MicroStrategy (MSTR) has continued to decline after being included in the Nasdaq 100 index, dropping to around $300, nearly a 45% decrease from its historical high of $543 at the end of November, and about a 30% drop from the $430 following the Nasdaq 100 inclusion announcement on December 14. Analysts point out that several market signals suggest that MSTR may have formed a short-term top, including: the company’s stock price skyrocketing nearly 8 times this year, founder Michael Saylor frequently appearing and promoting the new 'Bitcoin yield' indicator, and multiple companies beginning to imitate its Bitcoin reserve strategy.
Despite the recent significant pullback, MSTR's long-term performance remains impressive. The stock has still risen over 400% this year, with a cumulative increase of 20 times since it began implementing its Bitcoin reserve strategy in August 2020. Most analysts believe that MSTR has experienced similar magnitude pullbacks multiple times over the past three years, but ultimately ended with gains.