- MicroStrategy has expressed plans to sell up to $750M of its publicly traded equity and bonds, possibility to increase its Bitcoin holdings.
- Michael Saylor continues to soak his firm in crypto, using the strategy of selling stock and pouring the proceeds into BTC.
- Bitcoin price has moved from $29,200 to the $29,700 range after the announcement from MicroStrategy, a significant shift in the hourly timeframe.
Bitcoin (BTC) price has made a commendable move in the lower timeframe, rising despite the overall lack of volatility. With a little push from software developer firm MicroStrategy, the flagship crypto has reclaimed levels last seen around July 24.
Also Read: US Treasury yield rises while Gold takes a hit after weak US data; Could Bitcoin price suffer too?
Bitcoin price movements solidify in the lower timeframe
Bitcoin (BTC) price has finally edged north after recording fresh lows at the start of the week. The move draws the attention of traders and investors from the higher timeframes to the lower variants, where we can see some action.
Bitcoin’s latest spike, defined as a single quick motion of short duration, followed a revelation from MicroStrategy and its Chairman Michael Saylor in an SEC filing on the evening of August 1 during the US session about plans to increase its BTC holdings.
JUST IN - MicroStrategy to raise up to $750 million to buy more #Bitcoin and fund other corporate purposes. pic.twitter.com/gtMzwC5vcG
— Bitcoin Magazine (@BitcoinMagazine) August 1, 2023
Michael Saylor and his firm have been one of the front-lining champions for BTC, whales with a bold strategy to grow their Bitcoin portfolio whether the market is trending or not. In his latest declarations in the filing, Saylor has indicated plans to sell his company’s stock worth approximately $750 million and comprising the company’s equity and bonds to Cowen and Company, LLC, Canaccord Genuity LLC, and Berenberg Capital Markets LLC.
Drawing a paragraph from the filing:
We intend to use the net proceeds from this offering for general corporate purposes, including the acquisition of bitcoin and working capital, and, subject to market condition.
Noteworthy, MicroStrategy is a publicly traded company, meaning the sales will take place in the stock market and be available to the general public. With the stock readily available to all interested investors, the company is guaranteed relatively easy access to capital. This comes as investors actively trade stocks on public exchanges, making it easy to identify investors looking to purchase new offerings, fund expansions, or both.
Private companies may not enjoy such privileges, compelling them to present such propositions to their own investors, asking for an in-house contribution of additional funds, or having to secure a debt to raise funds. There are many capital constraints and procedures on this side of the fence.
Bitcoin price reaction to the news
Bitcoin (BTC) price has responded to the news, breaking out and flipping the resistance levels due to the 50-, 100-, and 200-day Exponential Moving Averages (EMA) at $29,188, $29,234, and $29,342, respectively, into support. Further north, the flagship crypto has extended a neck high to tag the $29,789 barricade, levels last seen around June 24.
The Relative Strength Index (RSI) at 78 is concerning, but the price could still increase. This aligns with Welles Wilder’s interpretation of an overbought asset on the RSI indicator, marking that confirmation to a point when the RSI crosses below the 70 level to the downside.
Similarly, the histograms of the Awesome Oscillators are in the positive zone with large volumes, showing that bulls are leading the market.
BTC/USDT 1-hour chart
Conversely, if retail traders begin to cash in on the gains, though small, Bitcoin price could correct south, possibly falling back under the foothold of the three EMAs.
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