Saylor's Orange Chart Signals Another Big Bitcoin Buy

Michael Saylor, chairman of Strategy, has posted a chart on X with the phrase 'More orange than ever', indicating that his company is buying more Bitcoin. This is a signal that has become a leading indicator for Wall Street, as Strategy has filed an 8-K confirming a fresh buy within a day or two of Saylor's post. In the past, Saylor's one-line posts have become a trading signal, with traders following his charts and reacting to his tweets.

Strategy is the largest corporate holder of Bitcoin, and its buying has become a proxy for corporate treasury conviction in the asset. Every week, Saylor adds to the company's Bitcoin holdings, even as the price trades well off its highs. The market has come to expect this buying, and reacts to Saylor's tweets as a signal of the company's commitment to Bitcoin.

However, the premium of MSTR's stock to its underlying Bitcoin holdings, also known as the mNAV, has collapsed. The stock traded around 1.13x to 1.14x its net asset value in early October, down from a historical peak above 4x. This means that the market is no longer paying extra for Saylor's edge and promise to compound BTC per share.

The market is pricing MSTR almost dollar for dollar against the coins in the vault, indicating that the promise of Saylor's edge is worth less than it used to be. The question remains whether anyone still pays extra for the stock, which has lost its premium.