Bitcoin gained more than +4% this week and is at a one-and-a-half week high, moving back above the psychological 50,000 level and surpassing the three-and-a-half month high reached on August 23.

Signs of mainstream acceptance of bitcoin are fuelling the current bitcoin rally. Twitter’s possible action to allow bitcoin as a payment option illustrates the increased institutional interest in the cryptocurrency. Additionally, September 7 is the day Bitcoin officially launches as a legal tender in El Salvador.

According to a recent report from MacRumors, Twitter may be laying the groundwork to allow bitcoin payments in its Tip Jar feature. Twitter’s latest update introduces support for delivering content with bitcoin payments using the Tip Jar feature that Twitter introduced earlier this year. The addition of a bitcoin payment option comes after Twitter CEO Jack Dorsey said in July that bitcoin was important to the company and would be integrated with Tip Jar in the future.

On Tuesday, September 7, El Salvador’s bitcoin law will go into effect. On that day, Salvadorans will be able to download the government’s Chivo digital wallet, enter their ID number and receive $30 in bitcoins. The Salvadoran government has created a $150 million fund to support bitcoin to U.S. dollar conversions and has established 50 financial centres throughout the country to withdraw or deposit money. The government will install 200 bitcoin ATMs to allow its citizens to convert bitcoins to U.S. dollars and withdraw them in cash, as part of its plan to make bitcoins legal tender. El Salvador will be the first country in the world to use bitcoin as legal tender.

Crypto currencies have surged this year due to increased institutional interest and accelerating development in areas such as decentralized finance (DeFi) and non-fungible tokens (NFT). Friday’s +3% rally in bitcoin has driven other crypto-currencies higher. Ethereum (ETHUSD) rose more than +2% to a 3.5-month high, with the overall crypto-currency market jumping +5% to $2.3 trillion.

Bitcoin has cleared several hurdles in recent days: the 200-period moving average and then the psychological threshold of 50,000. Analysts expect it to close above the resistance level of 51,050 which held up prices from a further surge a couple days ago.

Breaking above this level releases a potential bullish move towards the May high of USD 59,529. Traders may take advantage of this breakout and position themselves long on BTCUSD. Prices are now above the 20 and 34 period ascending moving averages. This bullish scenario would be invalidated below support at USD 46,726.

Support & Resistance Levels:

R3       59529
R2       57145
R1       53198
S1        50000
S2        46726
S3        42500

Analyzed by: Mr.Thibault Moirez, Independent Analyst