Bitcoin (BTC) surged to one-week highs, reaching the $29,700s on Tuesday, as the US software company MicroStrategy announced its intention to significantly increase its Bitcoin holdings.

MicroStrategy revealed its plan in a filing with the US Securities and Exchange Commission (SEC) to sell up to $750 million in stock, a portion of which will be allocated for purchasing more Bitcoin.

Currently holding 152,333 BTC as of June 27, MicroStrategy’s accumulation of the cryptocurrency began in August 2020, and the firm has been consistently adding to its holdings.

Michael Saylor, the former CEO and current executive chairman of MicroStrategy, has been one of Bitcoin’s prominent and vocal advocates.

The company’s filing stated that the proceeds from the stock offering will be utilized for various corporate purposes, including Bitcoin acquisition and working capital.

Should MicroStrategy decide to raise and invest the entire $750 million in Bitcoin, it could secure around 25,000 tokens at the current market rate.

However, large buyers in the market typically drive prices higher due to their influence, as indicated by Bitcoin’s immediate reaction to MicroStrategy’s announcement.

Currently trading in the $29,700s, Bitcoin has risen more than 4%, or approximately $1,200, from its recent lows in the $28,500s.

Furthermore, technical analysis suggests the potential for additional short-term gains. The recent rebound of Bitcoin from its Tuesday lows was facilitated by strong support levels.

The optimism surrounding institutional adoption, highlighted by the influx of spot Bitcoin ETF applications in June and a positive macroeconomic environment, has led many analysts to expect significant buyer interest at this crucial support level.

This prediction proved accurate as Bitcoin quickly recovered from its mid-$28,000s lows on Tuesday.

MicroStrategy’s announcement of a stock sale combined with a Bitcoin buying spree further bolsters the likelihood of maintaining this support zone in the near term. This strengthens the potential for a retest of the yearly highs around the upper $31,000s.