Rashad

$CNYUSD responsible for rise in $BTCUSD ??

FX_IDC:CNYUSD   YUAN RENMINBI / US DOLLAR
19 0 0
I recently read an article of Reuters explaining that the recent rise in $BTCUSD has the $CNYUSD sell off to thank.
http://www.reuters.com/article/markets-bitcoin-china-idUSL8N18T1P9

But out of curiosity, I wonder what percentage of the $BTCUSD rally was caused by Chinese traders buying into Bitcoin . After all, most Chinese DON'T invest their money into the market. Perhaps the $BTCUSD rally is caused by traders buying because they think other traders (particularly the Chinese) will buy. Thus the current Bitcoin rally could be explained as a "self fulfilling loop"

Finance minister Lou Jiwei says that china has no interest to devalue it's currency any further, and has attributed these conversations to media hype.
http://www.ecns.cn/business/2016/02-25/200377.shtml

The discussion of a June rate hike in the US may be what is fueling speculation on a $CNYUSD devaluation. But recent economic indicators would suggest the FOMC may approach this month's meeting with caution. Although home prices are rising, a sign of strength, the recent employment numbers were soft and in part caused by decreasing participation in the labor market, not a sign a sign of strength. As we approach the FOMC announcement, if economic indicators continue to produce soft numbers, we should not expect a rate hike. This in turn should fuel a rebound in $CNYUSD, which may cause a $BTCUSD sell off.

At this point, it is anyone's guess how high the $BTCUSD rally will go. But if the recent rally was indeed fueled by speculation of a $CNYUSD devaluation, which is in turn fueled by fed rate hike speculation, then it would not be surprising if we begin to see a selloff in $BTCUSD following more weak economic indicators.
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