Definition of currency (BTC protocol) & a look at the BTC charts.

Quite some time ago, people used just about anything of value to barter in order to get what they wanted. If I had a chicken farm and wanted a coat, I would head down to the market place to the cloths seller and we would essentially come up with a fair trade. (Provided that the coat producer wanted a chicken).

Money was eventually developed for convenience, you could sell your product for 'money' and you could take that and purchase other goods or services.

Precious metals were used in various areas because they had several inherent characteristics about them.

1. A store of value - Unlike sea shells, there is a limited quantity.
2. Divisible - You can divide the amount of the metal into different sizes.
3. Durable - Precious metals cannot be burnt away and will last 'forever'.
4. Transferable - You can easily transfer any amount to someone.
5. Fungible - One ounce of silver is the same as someone else's one ounce of silver, they are interchangeable.

How about Bitcoin?

1. A store of value - The protocol was set to a limited quantity of 21 million.
2. Divisible - You can divide the amount to .00000001 satoshi.
3. Durable - There is no physical item here...the software protocol/blockchain is set on the network and cannot not be removed.
4. Transferable - You can easily transfer any amount to someone.
5. Fungible - One bitcoin is the same as someone else's bitcoin, they are interchangeable.

Satoshi was really thinking forward for his endeavor to start a 'Peer-to-Peer Electronic Cash System'. I wonder if he ever thought that it may be the world reserve currency someday?

Onto a few charts...
Here is a daily chart of BTC with a clear upwards channel. I am still surprised that it broke out and over the top channel line, but this is BTC and just about anything can happen.

Same daily chart, but a closer look at the current situation. In the previous analysis, it was mentioned that the pullback may find support at the previous high of $6189, the 50 day moving average or the last major high of $4973.

It touched the 50 dma and has since reversed to the upside and has just pierced the upper trend line. If you look at a 1 hour chart, it did have some resistance at that line.

My speculation is that it may reach close to the previous high and head back down towards the upper trend line. It is getting squeezed between the previous high and the rising 50 dma. It will be interesting to see how this trades going into the next few weeks.

*I did purchase some BTC on the dip.

*Nothing in this post is investment advice.

Happy Tuesday! =}