Bitcoin has broken above its head and shoulders pattern and with a good break.
Will there be more upside? I believe we are on the doors of this large move.
However it really isn't to do with US Dollar weakness...it is all to do with CHINA!
I mentioned in a previous post why this is the chart you need to be watching!
As you can see, we are about to break into all time highs. You need to realize that most of Bitcoin volume is Chinese traders.
You do not require permission from the government to open a trading account since crypto is decentralized (Bitcoin anyways). Also, you can day trade it in China. When Bitcoin moved to 20k. over 80% (some say 90%) was Chinese money! Many do not talk about this.
The Chinese Cmmunist Party (CCP) made Bitcoin trading illegal, the average Joe in China dumped their Bitcoin, that's when Bitcoin crashed.
Now things in China are going from bad to worse. Money is now leaving China. Hong Kong was a way to get money out of mainland China and then into places like Canada and Australia. Mainland China is coming down hard on Hong Kong and will remove their British system of Law. A lot of Hong Kong money is fleeing.
Bitcoin provides a way for Chinese money to leave the country. This is why the alt coins are not really moving. If you are trying to remove a large amount of money Bitcoin is still the best (Litecoin and Ethereum as well...more Litecoin). You would not do it through the other alt coins...
The CCP also uses Bitcoin when the Yuan is about to be devalued. Kyle Bass speaks a lot about this. If we get the break on the USDCNH...expect a BIG move up.
Unfortunately, for the alt coin traders/speculators, two things are needed for alt coins to get a big bid (one outlier is a geopolitical/economic crisis...perhaps money may run into alt coins although Bitcoin, Litecoin, Ethereum will probably do better.
1) Regulation. Once crypto markets become regulated, banks and institutions will jump in. They need regulation though because it is hard to justify to your customers buying crypto's when brokerages can shut down and there is no deposit protection.
Of course the crypto purists hate this because it would mean wall street would get their hands on crypto's. Not really decentralized anymore.
2) A flood of new buyers. Many of the average Joe people who jumped into crypto's during the last run are holding alt coins. They missed the move in Bitcoin so jumped on the cheaper coins for yield. A lot of them are holding losing positions, and are likely to sell at break even if prices go up. There will be a large selling pressure as price moves higher. It needs to attract new buyers.
Hi, i am interested in China stocks, indexes,etc. Could you share the source where you say 80% of the money that drives bitcoin to 20k is from China ?
At best, my performance on cryptocurrencies is a roller coaster ride as relying on charts alone is a heart pounding exercise and having lost a few shirts before, I tend to day trade instead of holding it for longer time. Appreciate your inputs, thanks !
Uncharted-FX
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@dchua1969, Hi! It was covered by zerohedge back in the day but if you listen to hedge fund manager Kyle Bass on Youtube or even Martin Armstrong, they talk about it a lot. Kyle Bass is probably the guy you want to watch when it comes to China. He has been calling for issues in Hong Kong which we are now seeing...he is betting on the Hong Kong Dollar to go down (drop the peg). But yea on youtube search "kyle bass bitcoin" or "kyle bass china" he has some good stuff and talks about Bitcoin being the China play.
Yes I understand about the roller coaster! Especially recently there has been a lot of volatility on all markets given the environment we are in. For the long term, I am bullish Gold, Silver and Bitcoin...so I do expect their prices to go higher.