BTC; The long term view, looking for price drivers and China
There are links between bitcoin and Chinese capital outflows and the control thereof and currency relations / controls of Chinese currency. The relationship is highlighted with the comparison of the prices of BTCUSD (light blue area) and USDCNH (Dark blue line).
This is useful in helping to form an idea of which direction the BTC may take. Currently there is a divergence in the price between BTC and USDCNH, which may point to a future weakening of bitcoin demand.
Both the trends remain in a long term bull pattern as long as another higher high is made. Currently there is some divergence in the price between BTC and USDCNH, which may point to a future weakening of bitcoin demand or at least slowing of the momentum of this trend.
I am watching to see if the USDCNH reverses its trend and the Chinese Yuan starts strengthening. If so I will become bearish on the bitcoin. Currently, because the Yuan is still moving upwards, respecting the brown/orange trendline and the bitcoin is also in a bull trend. However I will change my opinion to neutral if the Yuan (blue) breaks through the orange trend line. I will probably change to a bearish stance if the bitcoin follows suit and forms a lower low, past the $950 / $900 area.
This is useful in helping to form an idea of which direction the BTC may take. Currently there is a divergence in the price between BTC and USDCNH, which may point to a future weakening of bitcoin demand.
Both the trends remain in a long term bull pattern as long as another higher high is made. Currently there is some divergence in the price between BTC and USDCNH, which may point to a future weakening of bitcoin demand or at least slowing of the momentum of this trend.
I am watching to see if the USDCNH reverses its trend and the Chinese Yuan starts strengthening. If so I will become bearish on the bitcoin. Currently, because the Yuan is still moving upwards, respecting the brown/orange trendline and the bitcoin is also in a bull trend. However I will change my opinion to neutral if the Yuan (blue) breaks through the orange trend line. I will probably change to a bearish stance if the bitcoin follows suit and forms a lower low, past the $950 / $900 area.
Comment:
The BTC looks overbought. I would be starting taking profits around here.
