A single enigmatic post by Michael Saylor caused Bitcoin to rise over $4,000 in just 3 hours on Monday morning in Asia. His message, “₿ack to Orange Dots?”, sparked speculation about MicroStrategy's accumulation strategy, pushing the digital asset from below $88,000 to above $91,000.
This reaction emphasizes how strongly the chairman's communication influences market sentiment. Even when the overall market sentiment is engulfed in extreme fear.
Orange, green dot system decoding
Michael Saylor's color-coded system significantly impacts the market. The 'orange dot' indicates each Bitcoin purchase event by MicroStrategy, which can be seen on the company's StrategyTracker.com portfolio chart. Each mark represents another stage of the company's strong Bitcoin accumulation plan.
The green line on the chart indicates the average purchase price of all purchases and serves as a benchmark for performance. As of December 8, MicroStrategy holds 650,000 BTC valued at $57.8 billion, with an average cost per coin of $74,436. This position reflects a 19.47% increase, representing approximately $9.42 billion in unrealized gains.
Recently, Saylor added a new change to this visual vocabulary. His cryptic 'green dot' sparked speculation about potential strategic changes. The green dotted line traces average costs and has emerged as a focal point. Some analysts believe that high purchasing activity could elevate this indicator.
Hours after Saylor's update, the price surpassed $91,000. The day's range expanded from $87,887 to $91,673, highlighting significant volatility around the signals.
Market trends…trader positioning
Despite the surge, market sentiment remained fragile. The fear and greed index signaled ongoing anxiety, but the long-short ratio showed positive trader positioning. As fear and profit crossed paths, market psychology remained complex.
According to data from CoinGlass, Binance and OKX reported 52.22% long positions and 47.78% short positions, while Bybit showed a stronger bullish bias with 54.22% long positions and 45.78% short positions. The latest 4-hour futures trading volume showed $106.77 million (56.23%) for long and $83.11 million (43.77%) for short. Traders appeared optimistic despite the fearful sentiment indicators.
The separation phenomenon between sentiment indicators and trader positioning highlights today's market complexity. Many wish to bet on the momentum that continues after influential signals from large holders. However, fear still lingers in the background.
MicroStrategy's influence is broader. The company recently built a cash reserve of $1.44 billion to cover dividends and provide liquidity for 21 months. On December 1, 2024, it acquired approximately 130 BTC for about $11.7 million at $89,960 per BTC, increasing its total holdings to 650,000 BTC.
Strategy change…market impact
In recent weeks, the company's approach has changed. CEO Phong Le recently acknowledged that MicroStrategy could sell Bitcoin. This is contingent upon the stock price falling below one times the adjusted net asset value, and not raising equity or debt. In November 2024, mNAV reached 0.95, bringing this scenario closer to reality.
This marks a shift from the previous stance of 'never selling.' Due to annual dividend demands rising to between $750 million and $800 million, the company had to consider new liquidity. This made the market role similar to leveraged Bitcoin ETFs. The stock price has fallen over 60% from its peak, raising questions about continued accumulation during volatile times.
