BITCOIN & Chinese stocks. The Divergence that happens mid-Cycle.

12 Eki 2023

This is another very informative study that brings together Bitcoin (BTCUSD) and this time, the Chinese stock market (CN50 - blue trend-line). We are looking into the last two Cycles and how in particular the Chinese stocks often lead BTC moves before they happen.

Our focus is in the phase after the Bear Cycle bottom and before the Halvings. As you can see during both of the last market bottoms, the Chinese stocks started to rise first and a few weeks after BTC followed. This led us to the Divergence phases (then 2019 now 2023), which precede the Halving events. During those phases, we see the two assets diverge. In 2019 the Chinese stocks kept rising while BTC fell. In 2023 the Chinese stocks are declining but on a low pace, while BTC mostly rose.

Theoretically, the closer we will get to the Halving, the more the two should converge. But does this mean that a potential rise on Chinese stocks will first make BTC decline more? Or it will resume the norm that China will lead BTC moves again, i.e. BTC will follow with a rise of itself?

What do you think, which scenario will take place first? Feel free to let us know in the comments section below!

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