There are two conflicting signals in the price action of Bitcoin.
The China/US trade war suggests price moves upwards as the situation continues to escalate or at least not de-escalate.
Against this, Altcoins are not prospering.
Here is a chart with several major altcoins running alongside Bitcoin.
This underlines that the Bitcoin rally is driven by the US/China trade war as buyers have come into the market to get out of Yuan and into as close as they can to dollars in as invisible way as possible. It’s the Bitcoin as digital gold theme in practice. Getting into the smaller crypto assets is simply going to prove harder and riskier than dumping your fiat into BTC and as such Bitcoin is going to be the major beneficiary of this situation.
It is however still unnerving to see mining rewards dropping for altcoins and prices stagnating because it suggests that this rally is not broad based unlike the rally in 2017 where everyone and their cat was piling in.
Its probably a good thing because another burst of mania could bring down the sort of unwelcome attention by government most doubters believe will be the end of Crypto. Meanwhile the potential of escalating trouble in the trade war delivers enough upside for such a small but compelling asset.
So now BTC is making a run at a break out above 11,000 and the chart pattern, as old as the hills, the flag.
Im no fan of this technical indicator but its quite popular.
Here it is:
In my experience you can keep drawing flags as the sideways trend expands but in a less than random market like Bitcoin old school charting seems to hold good more than in modern markets which have high level of efficiency.
For me the following chart is more interesting. It’s the same chart but looked at differently, most likely in a way few people choose to:
Now to me thatis a very bullish chart. It’s a monthly chart. The thing to remind ourselves is the current bar can look very different in a day or two but that right now it looks about to explode.
If this comes to past however, the altcoins will not keep up, as long as the sole driver of the rally is Chinese buyers. It will however begin to cement crypto as the new Gold and long term this will crive the value of the altcoins because ultimately the narrow supply of Bitcoin will mean the incoming moneyflow will percolate into the other assets.