Michael Saylor's Microstrategy to Issue Debt to Buy 200,000 More Bitcoins Over 5 Years

Bitcoin ($BTC) briefly rose to $77,000 on Thursday as the U.S. Spot Bitcoin ETFs were recording their biggest daily net inflow since the funds

The U.S. Spot Bitcoin ETFs are continuing to buy huge amounts of BTC, which is having the effect of driving the price even higher. On Thursday, the ETFs recorded their biggest daily net inflow since being launched on January 11 this year. Of the 17.99K BTC purchased by the funds, Blackrock’s IBIT was responsible for the vast majority, with a 14.63K BTC purchase.

To put this one-day purchase into perspective, the total daily issuance of Bitcoin is 450 BTC. Therefore, the total buying by the ETF funds on Thursday was nearly 40 times the total daily mined amount.

This massive buying is also being aided by other large institutions, such as Microstrategy, which is planning to buy an additional 200,000 BTC over the next five years by issuing debt. At the same time, the next U.S. administration is also planning to look at legislation that would require the U.S. to buy and hold large amounts of BTC in a Strategic Bitcoin Reserve.

This is all part of a larger trend, with other countries also being expected to follow suit, which could potentially create a feeding frenzy on an asset that is like no other in the financial world.

On the shorter time frames, it appears that the price has managed to get above the ascending channel, which is a very bullish move. This move was no doubt aided by the Spot Bitcoin ETF purchases on Thursday. If Friday is another big net inflow day, BTC could make the top of the channel a more definitive support, together with the $76,000 horizontal level.

The Fibonacci sequence on the chart is only valid if $77,000 does become the top for this upside move. If this is the case, the retracement levels are $74,600, $73,000, $71,900, $70,700, and the absolute base case of $69,000, which is the deepest 0.786 Fibonacci level, and the top of the 2021 bull market.

For momentum purposes, the 4-hour Stochastic RSI is on its way down, while the 8-hour and 12-hour are still very near the top. The 1-day Stochastic RSI is approaching the top. This would generally indicate that the bulls are tiring somewhat, and that some kind of a retrace would probably be forthcoming.

On the longer time frames, it is clear to see how important the previous bull market high of $69,000 has become. The eight months of repeatedly tapping on that resistance level displayed just how tough this nut was to crack. Now that resistance has been broken, and assuming that the current 2-week candle closes above, it really should be onwards and upwards from here.

As already discussed, there may be a bit of chop to come over the next several days, as the short-term Stochastic RSI momentum indicators come back down, but when one sees that the weekly, 2-week, and monthly indicators are angled upward, it could be expected that the price increases for BTC continue, at least into the end of the year, and perhaps some way into 2025.