Concise Playbook for the Week, Global Markets Playbook

Kevin George

Concise Playbook for the Week

Global Markets Playbook

I am an active trader in stocks, FX and commodities with over 15 years' market experience. I hold a master's degree in finance and have developed a strong skill base in technical analysis. 

Alongside technical setups I will provide earnings analysis, company valuation analysis and macroeconomic studies for the key market releases.

Equity Bottom-Up

Microstrategy Inc Cl A / Equity Bottom-Up

<ul>
<li>MicroStrategy is currently overvalued and has a potential downside of up to 75%, making it an unwise investment for Bitcoin exposure.</li>
<li>Analyst at TD Cohen makes a bullish call on MicroStrategy as a Bitcoin play, but author disagrees.</li>
<li>MicroStrategy (NASDAQ:MSTR) is set to release its second quarter earnings.</li>
</ul>


MicroStrategy is currently overvalued and has a potential downside of up to 75%, making it an unwise investment for Bitcoin exposure.
Analyst at TD Cohen makes a bullish call on MicroStrategy as a Bitcoin play, but author disagrees.
MicroStrategy (NASDAQ:MSTR) is set to release its second quarter earnings.


MicroStrategy: A Dilutive Share Issue Or Bitcoin Sale May Be Due

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">MicroStrategy Inc (MSTR US)</a> is trading at a ~2% discount to NAV as the crypto rout moves into a higher gear.  </li>
<li>Bitcoin briefly dipped below US$25k in the last 24 hours, an 18-month low. If it falls another 18%, this will trigger a margin call on one of MicroStrategy's loans.</li>
<li>All is not well elsewhere in cryptoland. Ethereum touched a 17-month low; the Luna/Terra ecosystem has crashed; and crypto lender Celsus capitulated ~60% this morning after freezing withdrawals. </li>
</ul>



MicroStrategy Inc (MSTR US) is trading at a ~2% discount to NAV as the crypto rout moves into a higher gear.  
Bitcoin briefly dipped below US$25k in the last 24 hours, an 18-month low. If it falls another 18%, this will trigger a margin call on one of MicroStrategy's loans.
All is not well elsewhere in cryptoland. Ethereum touched a 17-month low; the Luna/Terra ecosystem has crashed; and crypto lender Celsus capitulated ~60% this morning after freezing withdrawals. 


MicroStrategy (MSTR US): It's Cratering Time

Full disclosure - I'm somewhat of a cryptocurrency sceptic. I think Bitcoin is not an "investment" but a "speculation." SEC officials have stated their view that bitcoin is not a “security” for purposes of the US federal securities laws. It has zero correlation with the real economy and zero fundamentals - and can potentially go to zero.  It is, in my view, digital Monopoly money.
I stop short of calling Bitcoin a Ponzi scheme. There are no centralised actors here primed to bail (or at least no publicly-self-identifying centralised actors)
BUT - and there's always a but - Bitcoin is a recognised commodity. And it is possible to obtain crypto Visa cards and store crypto in a PayPal account, which lends a certain confirmation bias with the support of these traditional financing systems. Or perhaps the transaction fees revolving around cryptos are simply too big to ignore. 
And there is an increasing number of jurisdictions world-wide granting money transmitter licenses to cryptocurrency exchanges - although news overnight of the UK watchdog banning crypto exchange Binance serves to illustrate the issues surrounding these regulated activities.  
This all brings us to <a href="https://www.smartkarma.com/entities/microstrategy-inc-cl-a" target="_blank" data-smartkarma-citation="entities:14717:1" rel="noopener">Microstrategy Inc Cl A (MSTR US)</a>. 
As of the<a href="https://www.microstrategy.com/en/investor-relations/press/microstrategy-acquires-additional-bitcoins-and-now-holds-over-105000-bitcoins-in-total_06-21-2021" target="_blank" rel="noopener"> 21 June</a> MicroStrategy holds  "approximately" 105,085 bitcoins, which were acquired at an aggregate purchase price of $2.741bn and an average purchase price of $26,080/ bitcoin.
Microstrategy is, in effect, a holding company for bitcoin. Stub ops are largely immaterial.
That stash of "coins" is currently worth US$3.6bn versus Microstrategy's current market cap of US$5.4bn. This is before factoring in the three hard-currency fund-raising exercises in the past six months. Mmm.
More below the fold.

Full disclosure - I'm somewhat of a cryptocurrency sceptic. I think Bitcoin is not an "investment" but a "speculation." SEC officials have stated their view that bitcoin is not a “security” for purposes of the US federal securities laws. It has zero correlation with the real economy and zero fundamentals - and can potentially go to zero.  It is, in my view, digital Monopoly money.
I stop short of calling Bitcoin a Ponzi scheme. There are no centralised actors here primed to bail (or at least no publicly-self-identifying centralised actors)
BUT - and there's always a but - Bitcoin is a recognised commodity. And it is possible to obtain crypto Visa cards and store crypto in a PayPal account, which lends a certain confirmation bias with the support of these traditional financing systems. Or perhaps the transaction fees revolving around cryptos are simply too big to ignore. 
And there is an increasing number of jurisdictions world-wide granting money transmitter licenses to cryptocurrency exchanges - although news overnight of the UK watchdog banning crypto exchange Binance serves to illustrate the issues surrounding these regulated activities.  
This all brings us to Microstrategy Inc Cl A (MSTR US). 
As of the 21 June MicroStrategy holds  "approximately" 105,085 bitcoins, which were acquired at an aggregate purchase price of $2.741bn and an average purchase price of $26,080/ bitcoin.
Microstrategy is, in effect, a holding company for bitcoin. Stub ops are largely immaterial.
That stash of "coins" is currently worth US$3.6bn versus Microstrategy's current market cap of US$5.4bn. This is before factoring in the three hard-currency fund-raising exercises in the past six months. Mmm.
More below the fold.

Microstrategy (MSTR US): "Crypto Through The Tulips"

Technical Analysis / Chartered Market Technician, The Markets Academy

David Coloretti, CMT

Technical Analysis / Chartered Market Technician

The Markets Academy

Technical Analysis

Microstrategy Inc Cl A / Technical Analysis

<ul>
<li>TSS or "Trend Sustainability Score" is our proprietary momentum based tactical methodology. TSS has a proven record of identifying the exhaustion points in interim trends. </li>
<li>On 17 February 2023 TSS identified exhaustion in the MSTR US uptrend and targeted a minimum 10% reversal in 1-2 weeks.</li>
<li>On 24 February 2023 MSTR US completed a 12.4% reversal from 284.03 to 248.87.</li>
</ul>


TSS or "Trend Sustainability Score" is our proprietary momentum based tactical methodology. TSS has a proven record of identifying the exhaustion points in interim trends. 
On 17 February 2023 TSS identified exhaustion in the MSTR US uptrend and targeted a minimum 10% reversal in 1-2 weeks.
On 24 February 2023 MSTR US completed a 12.4% reversal from 284.03 to 248.87.


MicroStrategy Inc (MSTR US): 12.4% Profit Target Achieved in 5 Days

<ul>
<li>MSTR US has rallied strongly in 2023 (+138%), peaking at a new 6 month high of 315.00 on 16 February 2023.</li>
<li>The 315.00 peak was plagued by extreme ST momentum failure and new highs were quick to fail and reverse.</li>
<li>Our TSS methodology triggered a TSS &lt; 10 at the high and justifies a further 10-13% decline in the coming 1-2 weeks.</li>
</ul>


MSTR US has rallied strongly in 2023 (+138%), peaking at a new 6 month high of 315.00 on 16 February 2023.
The 315.00 peak was plagued by extreme ST momentum failure and new highs were quick to fail and reverse.
Our TSS methodology triggered a TSS &lt; 10 at the high and justifies a further 10-13% decline in the coming 1-2 weeks.


MicroStrategy Inc (MSTR US): TSS < 10 - Target Tactical 10-13% Decline

United States

MicroStrategy Incorporated provides business intelligence software and related services.  The Company's technology platform enables departments and enterprises to deploy Web-based reporting and analysis solutions.  MicroStrategy also offers consulting, training, and support services.  Solutions are provided to retail, finance, telecommunications, insurance, dot-com, and healthcare industries.

52-week Range	0.00 - 0.00
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Microstrategy Inc Cl A (MSTR US)

MicroStrategy (MSTR US): It's Cratering Time

In my last note, I recommended covering. That was an apt call. I would be putting on the short again here. The NAV discount could easily widen out...

David Blennerhassett

Microstrategy (MSTR US): "Crypto Through The Tulips"

At the current levels, I'd short Mictostratgy and go long BTC. Alternative conclusion to what one investor deemed Microstrategy to be a bitcoin...

David Blennerhassett

MicroStrategy Inc (MSTR US): 12.4% Profit Target Achieved in 5 Days

30+ years as a technical analyst and a razor sharp focus on momentum confirmation delivered TMA a 75% unleveraged return on our 7 Smartkarma...

David Coloretti, CMT

MicroStrategy Inc (MSTR US): TSS < 10 - Target Tactical 10-13% Decline

30+ years as a technical analyst and a razor sharp focus on momentum confirmation delivered TMA a 75% unleveraged return on our 7 Smartkarma...

David Coloretti, CMT

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)