We can see here what may be a cup and handle which if it does play out might suggest CNY has a lot more down to go.
What is a lot more interesting is that recent pretty much straight line starting on the 16th or 17th of May.
Also interesting is that first big green candle a few days prior around May the 6th of this year.
The dates are slightly different for bitcoin, but just by a day or two. The sideway here is also less of a clear straight line, but then it’s bitcoin.
It has been yoyo-ing up by $1,000, down by $1,000, but it’s still pretty much where it was on May 14th at about $8,000.
The first green candle here is also more difficult to see as bitcoin movements are obviously in candles that are quite a bit bigger than CNY’s movement, so you go to April and ignore that big candle, and you go to the second one starting at about $5,600.
That was around May 8th, with the two charts looking pretty much identical except bitcoin starts moving in April due to its own factors such as the joke that may have well started the bull run.eval(ez_write_tag([[300,250],'trustnodes_com-medrectangle-4','ezslot_1',169,'0']));
Because bitcoin has its own factors that can influence price in either direction, any correlation is usually temporary and varies, with it sometime being CNY, sometime gold, sometime stocks, and so on.
Here’s the dollar chart for example very much zoomed out, and we have that clear fall starting at the beginning of January 2017, with it reaching a recent bottom at the beginning of 2018.
For bitcoin the story is the same, but in reverse. Up and up in 2017, then a top at the very end of that year.
In 2018 the dollar then strengthened and strengthened, while bitcoin fell. The correlation ends however in January 2019 as both bitcoin and the dollar rise together.
Presumably that’s because CNY has become a common factor for both, with it unclear whether there is a causative relationship.
Studies will probably follow with a mini academic field of bitcoin finance starting to develop. That is still at the very early stages, but they all appear to agree this is an uncorrelated asset.
eval(ez_write_tag([[336,280],'trustnodes_com-box-4','ezslot_2',171,'0']));That doesn’t mean no correlation at any time, just it doesn’t correlate all the time. It doesn’t follow gold or stocks or the dollar or cny, but sometime it does.
That’s because bitcoin is a global asset accessible anywhere by anyone. So events in China or anywhere else in the world can influence it, just as can crypto specific related events.
Meaning bitcoin can be or can become a sort of barometer for the entire globe. How much is tech advancing somewhere, what happened somewhere, and at times even a globally shared and an undeniable measurer of truth.
One of its unique quality among many is that it can be both a good and a bad barometer. On the good side, its kind of a measurer of how educated and informed a people are and how much are they and their economy advancing. In addition, it can also somewhat indirectly show how free a people are.
On the bad side – well depending on how you see it – bitcoin can show where money is being mismanaged, where a crisis has suddenly developed and so on.
That’s because due to its very limited supply and as it is widely accepted in return for pretty much any national money, bitcoin can be one flight to safety asset among gold and “safe” bonds.
On the other hand, as bitcoin is still so new and has plenty of potential for growth and use cases – such as easy transport of value – keep increasing and being refined, it is also a speculative asset.
So if the economy does well, bitcoin does well. If the economy is not doing very well, bitcoin might still do well because unlike gold you can actually move it and pay with it and unlike bonds, millennials actually know how to buy bitcoin while they have zero clue of what bonds even are.
Meaning bitcoin is now developing as the world’s first global money since gold was widely used to exchange value a century ago.