Chairman Xi Jinpump and China Analysis

Xi Jinping

As happy and euphoric the crypto people are during bull markets, so angry and depressive they get in bear phases. We all experienced that in the last weeks, after the spar Bitcoin price rise of 42% on the 25th of October.
I call this pump the “Xi Jinpumb”. The 3rd biggest daily pump of Bitcoin was caused by the announcement of Chinas President Xi Jinping regarding the future Chinese influence in blockchain technology.

When Crypto Twitter Get Mad

After the Xi Jinpump, reality kicked in again and Bitcoin went down persistently until it bounced back at the levels of 6.600 USD. During this down phase, the crypto community got mad again. YouTubers made desperate videos and called several times for a bullish breakout that never happened. The content on Twitter got more and more insulting, and followed by that, many people started to look for someone to blame for this debacle. In my opinion, always the best signal for the near end of a bear market.
Also, many different bullish patterns got called by technical analysts: a falling wedge, diamante pattern, ….

Who to Blame?

As we know in the retrospective, none of them worked out. Many traders who followed this bullish forecasts got liquidated on Bitmex or Bybit. For all those traders, it was pretty clear to blame YouTubers and other “experts” for their loses. Of course, this is wrong but also a standard human reaction of anger. But whom to blame should not be the topic here. Let’s focus on the debate that started after the Xi Jinpump about the power of technical analysis (TA).
Let’s have a look at one of the key arguments that are brought up by critics of TA since that day.

An Easy Way to Get Rekt

On the 25th of October, the day when Chairmen Xi announced Chinas new blockchain strategy, Bitcoin was forming an excellent Death Cross on the daily chart. A Death Cross is a technical chart pattern that indicates the start of a significant selloff. A death cross is formed when the short term moving average (red line) is crossing below a long term moving average (green line). The most common averages used for this pattern are the 50- and 200-daily MA. As you can see in the picture below, the pattern formed correctly on the day right before the pump.

So if you had made your trading decision based on this reliable indicator, you would have gone rekt massively. Cause instead of the anticipated selloff, Bitcoin pumped as hard as it did last time in 2011.
This divergence between technical analysis and actual price action is water on the mills of many critics of TA.

Richard Heart vs. Tone Vays

One of them is Richard Heart, a Miner from the very beginning, a former “Bitcoin Maximalist” now a “Bitcoin Realist”. To make things short: A very controversial person. At the moment, he is shilling hard for his new project: The HEX-Token.
He argued with Tone Vays, one of the most famous BTC traders and technical analysts, at a discussion at Blockshow in Singapore. Both of them got asked about the current Bitcoin price analysis.

Tone Vays is Unqualified!

Heart pointed out that there is TA (technical analysis, FA (fundamental analysis) and now shown by the Xi Jinpump – also CA (China analysis). He even went further and called traders like Tone Vays, who don’t have their ear to Asia “unqualified”. He concluded that TA and FA got worthless since Chinese politics got more influence on the Bitcoin price than ever before. Maybe he is not completely wrong with this point of view. But it should also be mentioned that he is in a massive shilling campaign for his new token. That means he is in an endless loop of criticizing bitcoin, so China FUD in any way is always welcome.

When Signal Group?

IMO the only way to find out the seriousness of CA is the number of CA signal groups popping out on Telegram in the next weeks – irony!

What do you think? Let me know in the comment section.

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