The downward risk for Bitcoin is intensifying: The standoff between enterprise-level Bitcoin holder Strategy (MSTR) and global index provider MSCI is deepening, compounded by weakening technical structures, putting pressure on the market.
Key points:
If the bearish flag pattern breaks down, Bitcoin faces the risk of dropping to $77,400.
The tension between Strategy and MSCI adds institutional pressure to an already fragile landscape.
As of Wednesday, Bitcoin has been consolidating within a bearish flag pattern—typically a brief rebound that occurs after a sharp decline, often ending with a continuation of the original trend.
This structure indicates that sellers are regrouping rather than exiting, especially as Bitcoin continues to operate below the declining 100-day and 200-day exponential moving averages.
A decisive break below the lower edge of the flag will confirm a bearish continuation pattern, opening the way for Bitcoin to reach $77,400.
Conversely, if the price decisively breaks above $88,655 near the 50-4 hour exponential moving average (50-4 hour EMA; red waveform) and around $90,000 near the upper edge of the flag, it could invalidate this already bearish outlook.
Aside from the technical aspects, Bitcoin's decline may also be triggered by heightened uncertainty surrounding Strategy. The company is one of the largest enterprise-level Bitcoin holders. Currently, MSCI is reviewing whether to exclude companies with a majority of digital assets on their balance sheets from its indices.
According to CryptoQuant author GugaOnChain, MSCI's pending decision is expected to be made by January 15, 2026, coinciding with the weakening price structure of Bitcoin, which may introduce a new layer of institutional risk.
“If MSTR is excluded from indices like MSCI, passive funds will be forced to automatically sell their holdings, potentially amounting to billions,” he wrote in a post on Tuesday, adding:
JPMorgan also warned that if Strategy is excluded from the MSCI index, passive funds tracking these benchmarks may be forced to sell billions of dollars in stocks.
Analyst Adrian accused JPMorgan of launching a “targeted suppression campaign against MSTR,” aimed at forcing investors to turn to its own Bitcoin leveraged investment products. He wrote in a post on X:
Amid rising uncertainty related to MSCI, Strategy has begun to clarify its financial resilience in the event of further declines in Bitcoin.
In a statement on November 26, the company stated that even if Bitcoin falls to its average cost basis of about $74,000, it will still maintain a 5.9 times asset coverage ratio relative to its convertible debt, referring to this metric as its “Bitcoin rating” for its debt.
This article does not contain investment advice or recommendations. Any investment and trading decisions carry risks, and readers should conduct their own research before making decisions.
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