ETHUSD: 423 Support In Sight, But Short Squeeze Potential High.

ETHUSD update: Short term price action is poised to test the 423 reversal zone boundary as an inside bar is now present on this time frame. A break of the 454 low would be the signal for further weakness, but as ugly as this market looks, do not lose sight of the broader location.

When things look obvious, that usually means everyone is thinking the same thing. In this case, short. If day trading, that's one thing, but if you are expecting a big win, that is a high risk idea in my opinion.

Earlier I wrote an article on S.C. which highlighted the broader structures of this market. The 544 to 464 support zone (.618 of the recent bullish swing relative to the 374 low) and the fact that price is still holding way above the 374 historical low. If this broader structure does not break below 374, it will then be establishing a broader higher low formation. This is a place to accumulate for a bigger picture move higher, not sell.

423 is the next reversal zone boundary that presents a high probability location for bullish patterns. At S.C. we will be watching carefully for the opportunity to add to our inventory.

In summary, extreme sentiment is an opportunity that only a contrarian will recognize while the herd is busy following indicators that look backwards. Buying into this type of market goes beyond what you will see on a chart and has more to do with intangible concepts like best practices and crowd psychology. I liken this situation to the polar opposite of where this market was in January in terms of sentiment. The crowd was sure ETH was going to 2K in a matter of weeks and instead it went to 374. Now the market is fluctuating near lows but not making lower lows while volume is shrinking which is a not so obvious bullish sign.

In situations like this, you do not want to be part of the crowd. Do not be distracted by hype or attention seekers and do not be limited by irrelevant lines on a chart. If you recognize the long term merit of these coins, then these low prices are an opportunity to invest. It is no different than buying name brand items that go on sale.

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ETHUSD update: I am going to update BTC momentarily, but this market has touched the 423 reversal zone boundary and is now forming a pin bar. There is still plenty of time before it closes, it can still change. The key to watch for is how this bar closes and if the next bar takes out the high of this bar.