Key Takeaways
Why MSTR Affects Bitcoin’s Prospects?
MSTR has formed a bearish fractal pattern – mirroring the 2021-2022 downtrend – and insider selling signals weakness that has historically aligned with BTC’s declines.
What Does Bitcoin’s Recent 33% Drop Mean?
Such pullbacks often precede steep losses in December, signaling a possible deeper downturn if selling pressure continues.
Strategy (formerly MicroStrategy), Bitcoin’s largest corporate holder, currently has a portion of its treasury worth $56.23 billion on the market, and could be a key determinant of the King Coin’s next phase.
The company, which added 9,062 Bitcoin [BTC] in November, at the time of publication, saw its MSTR token dive into a bearish phase according to recent analysis.
Historically, this has not been good for Bitcoin investors.
Insider sell-off and emerging fractal patterns
MSTR has formed a fractal pattern, a similar move that previously led the asset into a significant bearish phase that lasted about a year between 2021 and 2022.
This pattern has now emerged as insiders, including company directors, are selling their MSTR shares on the open market, with millions of dollars in sales already recorded.
Source:
Due to the previous fractal formation, MSTR traded 689 days lower on the chart. So far, the current downtrend, which reflects this move, has only spanned about 364 days, according to chart data.
When the move is overlaid on Bitcoin’s daily chart, it shows a striking correlation. While this doesn’t guarantee the same outcome, it suggests that Bitcoin could continue down.
Source: TradingView
This implies that Bitcoin could enter a bearish phase of around 325 days, aligning with a potential bottom around October 2026.
Notably, MSTR has a Net Asset Value (NAV) multiple of 0.95, suggesting it is trading at a slight discount to its Bitcoin holdings.
Bitcoin’s performance in December
A recent Alphactal analysis shows that Bitcoin has now retreated 33% from its all-time market high.
Source: Alpharactal
Historically, such declines have often been followed by a bearish December, during which assets suffered large losses in value.
“The crypto market has just shown one of the clearest signs of structural weakness. And this opens the door for major volatility in the coming days, both up and down.”
This suggests that while selling pressure remains dominant in the market, there is still a strong chance that a deeper bearish move could occur in December.
AMBCrypto analyzed how Bitcoin has performed over the past five years in December.
Market analysis showed that apart from December 2021 – when Bitcoin fell and continued this trend into the new year, triggering a broader bearish cycle – other years followed a different pattern.
Source: TradingView
In those other years, December either remained bullish or preceded the start of a broader Bitcoin rally, with the asset posting notable gains.
For now, there is no clear guarantee of what December will bring, based solely on historical charts.
However, when looking through the lens of the four-year cycle, 2025 could witness a similar decline to what the market is experiencing today.
The broader market is still under pressure
The broader market is still in a bearish phase, with liquidity across the ecosystem dropping significantly.
Between the market’s peak in October and now, approximately $1.54 trillion has been wiped out of the total cryptocurrency market cap, underscoring the intensity of the downturn.
Bitcoin alone has accounted for approximately $800 billion of these outflows in a short period of time, indicating that investors are abandoning both Bitcoin and altcoins.
Until market confidence returns, Bitcoin could continue to record even lower levels on the chart as selling pressure continues to increase.