Strategy Faces Massive Drop as Volatility Fades, 10x Research Warns
10x Research has issued a bearish outlook on Strategy (MSTR), cautioning that the stock could be at risk of a 25% decline as volatility fades and momentum weakens.
The firm suggests a drop to $300 may be on the horizon if the company fails to maintain its current price levels.
Implied volatility for MicroStrategy has declined sharply from previous highs of 200–300% and now sits at 76%. Although still elevated, the collapse in realized volatility signals a likely compression in implied volatility, reducing the chances of the explosive upside moves that retail investors typically chase.
10x Research believes this could drive retail traders to shift toward more volatile alternatives, such as Japan’s Metaplanet, which has recently gained attention for its Bitcoin-focused strategy.
Meanwhile, MicroStrategy may be entering a phase where its ability to accumulate more BTC is limited compared to the past six months.
Technically, all reversal indicators have turned bearish. Momentum is deteriorating, and a bearish divergence has formed as the stock price remains high while underlying indicators retreat. The 21-day moving average at $390 is seen as a key level; any sustained move below it could trigger further downside.
The firm also points to options data: while implied volatility is dropping, it allows traders to buy protective puts at cheaper premiums. A put spread idea shared when MicroStrategy traded at $400 has already gained 66% in just one day, highlighting the market’s shifting sentiment.
In their strategy, 10x suggests shorting MicroStrategy around $400 with a stop at $430 and a target of $300, noting that a breakdown below $400 could confirm a move toward that lower price band.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
