New $40,000 Target, Huge Company Says To Buy More Bitcoin

  • MicroStrategy is preparing to raise another $500 million to invest in Bitcoin which will turn the market sentiment to the upside.
  • US CPI inflation and the consolidation event will be key events to watch this week as we can expect some volatility in the market.

The world’s largest cryptocurrency Bitcoin (BTC) posted solid gains over the past weekend, approaching $22,000. As of press time, BTC is trading at $21,753 with a market capitalization of $416 billion.

Bitcoin price rose as the US stock market remained positive last Friday. However, some analysts believe that Bitcoin could head towards $40K if the momentum continues. Jared Blikre, Senior Analyst at Popular Finance, wrote: “BTC forms a very large base at around $20K, with big bullish targets of $30K and $40K. Tons of 2021 price memory from $30K to $60K. Momentum is the key.”

Bitcoin’s recent move north has given investors hope for a new bullish trend. $20,000 remains a critical support on the downside. Although the price of BTC fell below it last week, it did not stay there for long.

Another reason for Bitcoin’s bullish move is that its largest owner Microstrategy is raising more funds to make new purchases. Last Friday, MicroStrategy filed for a $500 million share sale. The company said it will use the funds to make new purchases and add more bitcoins to its holdings.

According to the filing, the company must sell its Class A MSTR shares. However, there is no specific date for the potential sale announced yet. MicroStrategy said it intends to hold all future profits and buy additional bitcoins from them.

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As of its date, MicroStrategy owns a total of 129,699 Bitcoins with a total value of $4 billion and an average price of $30,666 per coin.

Two big events coming this week

Bitcoin and cryptocurrency investors will be watching with interest two major events coming up this week. On Tuesday, September 11th, the US will unveil its CPI inflation figures. As a result, we saw the Bitcoin pump cool off on Sunday.

Higher than expected inflation will prompt the Fed to take more restrictive monetary measures. The Fed is also set to announce a rate hike this month. According to market expectations, the Federal Reserve will announce a 75 basis point rate hike. However, if the CPI reading remains on the Fed, it may consider a 100 basis point rate hike.

Tony Sycamore, Senior Market Analyst, City Index Ltd. He said: “The market knows it has taken a break from this unyielding Fed rhetoric for a few weeks and that the pace of central bank rate hikes is likely to slow.”

Another major event coming this week is the much-anticipated Ethereum merger. Any hurdles in this merger could lead to selling pressure on ETH and the crypto market as well. So far, all developments in the merger have been on schedule.

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