10x Research claims that MicroStrategy's stock price may fall by 25%.

Gate News bot message, 10x Research released a market analysis report indicating that MicroStrategy may face a 25% fall risk.

The report states that the era of implied volatility reaching as high as 200% or even 300% is over. MicroStrategy’s at-the-money options are currently trading at 76%, which is still relatively high, but as actual volatility decreases, the decline in implied volatility may just be a matter of time.

As volatility declines, the likelihood of significant right-tail fluctuations (massive returns chased by retail investors) is becoming increasingly small.

Retail investors are eager for such explosive upside potential and may turn to more volatile stocks like Metaplanet.

As the volatility of MicroStrategy decreases, acquiring cheap volatility and selling it at a premium has become less attractive.

Unfortunately, we may enter a phase where the number of Bitcoins that MicroStrategy can acquire will be far less than in the past six months.

We consider shorting MicroStrategy at $400, setting a stop loss at $430, and taking on a risk of $30. If the stock price falls back to $300, we could potentially profit $100.

This pullback may simply be due to the compression of net asset value, or more broadly, because Bitcoin is beginning to consolidate. Unless MicroStrategy continues to significantly push up its price, consolidation is inevitable.

From a technical perspective, all three reversal indicators have turned bearish.

Momentum is waning, and we see a clear bearish divergence, as technical indicators are retreating even though stock prices remain high.

The 21-day moving average is currently at 390 dollars; we should avoid holding long positions below this level.

The implied volatility is relatively low, which may also limit upside risk, but it also provides cheap put option prices to express opinions. Failing to hold the $400 level could indeed open the door to $300.