Strategy stock price touches 360 USD support level, hedging funds dominate trading attracting follow.

[Coin World] Strategy, serving as a high beta proxy for Bitcoin, is showing signs of tension as hedge funds increasingly dominate trading and its largest shareholder reduces risk exposure. According to an analysis from a data platform on August 18, Strategy has been in one of its narrowest ranges in years, with $360 repeatedly acting as a key support level. The company's stock price has tested this threshold multiple times in recent months, reflecting reduced volatility and declining investor confidence. The report highlights that Strategy's largest shareholder, Vanguard, reduced its stake by 10% last quarter. While some investors who only go long have stepped in to buy, hedge funds have since controlled market activity. This shift raises the risk at the $360 threshold, which could determine whether the stock faces further decline or experiences a recovery.

Historically, Strategy has provided high exposure to Bitcoin ( BTC ) price fluctuations, but this dynamic may be weakening. The report notes that when the stock lags behind Bitcoin by about 20% over a month, it typically presents a favorable entry point, but hedge fund-driven trading indicates that market sentiment is changing. The data platform compared the performance of Strategy with other Bitcoin government bonds and found that companies holding Bitcoin are losing their market appeal. Since mid-July, Strategy's stock price has dropped by 13%, while Tokyo-listed Metaplanet fell by 37% during the same period. The analysis links these declines to the collapse of Bitcoin and Strategy volatility, thereby reducing the premium investors once paid for exposure. As convexity decreases, these companies' ability to amplify Bitcoin's rise has weakened, limiting their financing capacity.

At the same time, new investment flows are shifting towards Ethereum ( ETH ) government bonds and cryptocurrency initial public offerings, which are seen as offering fresher opportunities. According to data from the platform, this shift validates their call on July 19 that as the volatility compresses throughout the summer, Bitcoin government bonds will lose their advantage. The report leaves investors with a key question: should re-entry depend on specific price levels (such as $360), or on broader market conditions that may restore demand for government bond-style exposure?