ETHUSD update: New low made at 448 as price pushes into the next reversal zone and hesitates. New lows are a bearish sign, especially when they are occurring below the major support zone. Is this a signal to get short? To exit altogether? No, as ugly as these markets get, it is important to recognize that they are still in an expanding ecosystem.
Remember I am only interested in these markets from a bigger picture perspective. I believe in the technology that is behind these tokens, especially the main ones like BTC, this market and LTC. These are not markets I am interested in shorting, even if I could. If I want to short something, there are other markets that are much more liquid and much easier to access than these markets (Like FX or mini S&P futures). On top of that, if I had easy access and liquidity in these markets, (meaning I do not have to worry about the broker telling me they can't let me cover when I am trying to get out) I would on participate on a day trading time frame because I do not want to stay short a market that is on its lows (especially when its pushing extreme reversal zones).
With that being said, there is a reversal zone boundary at 424 which is relative to the 452 low. This means IF price is going to reverse, it needs to do it within this area. IF instead it closes lower with conviction, then I would simply steer clear of any new positions until stability reappears in these markets.
What does stability look like? For one, the two bearish trend lines that are in play need to be compromised. Then price action would then have to build a more bullish structure such as a broad higher low or double bottom which would express more of a longer term sign of strength returning. Until those scenarios happen, I would suggest staying out completely, accumulating small size on the lows, or if you are managing a long position, just ride it out.
In summary, the current situation reminds me of the way this market was at the highs. The world was euphoric and expecting price to go up forever, now we are in the opposite situation. These markets are full of fear, and it is no surprise that is happening after more institutional players got involved back in December. As long as there is a growing ecosystem and these tokens maintain their usability and relevance, new low situations like this only present very attractive prices to build inventory. I do not care what the news is saying, or the hype, because that information is only being generated to capitalize on the fear. I also want to capitalize on the fear and the way to do it is to buy small and build your inventory while the herd either exits, shorts it or loses interest altogether.
Saw a notification regarding your post pop up on my phone. Something about EthUSD. Without reading it, I could already guess that you would be doing your best to make a bullish case for Eth, despite its poor technicals. This has been the case with your posts recently.
You are now meshing subjective "fundamental analysis" with "objective TA" in order to make a case, both for your readers and yourself, that these markets continue to be bullish. Your obvious bullish bias, and likely your crypto positions, are tainting your ability to objectively interpret the markets.
These markets are purely speculative and have little fundamentals to fall back on. They are only as "bullish" as their price action is. Once the price settles into a downtrend, there are no limits to how low the price can go, just as there were seemingly no limits to how high prices went during the 2017 bullrun. If you understand the technology well, you will understand that Bitcoin doesn't have to be priced at 10k or even 7k to fulfill it's function. The same story goes for Eth.
@diegofnu, no opinion on ETH then? Thanks "analysis on the 'analysis on ETH' ", very interesting.
quantacake
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@jmkuah, Although it may contain fragments of bias info just as Warren Buffet's best sellers do or your own comment, he also states something we all are betting on - unless you're a troll - that is blockchain tech. I hope you would not be in this if you also do not look at the bigger picture of the tech you're risking your money on. How many people believed automobiles would become affordable or the internet would become mainstream before they were adopted. The interoperability of the tech that makes a blockchain currently has it's problems but no one with an understanding of it should deny it's revolutionary.
I think for it to fulfill its purpose of being an online currency which is the tech of a civ1 society according to the kardashev scale, it's future purpose is to be adopted by the mass. It's value will be increased when blockchain is widely used. Supply and demand will increase e.g. BTC far beyond 10k.
If you do not see blockchain being used mainstream, then what of finance? Beyond volatility, why would e.g. banks not use it when it would decrease employee costs, software upgrades, fraud, transaction pending time, etc.
The speculation of these markets will decrease as they continue to be used for their purpose.
tenzor7
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@jmkuah bull bear bull bear bull bear. The trend will reverse. First comes short squeeze then consolidation and then the bull. Then again comes the bear. We just need to wait for reversal and then buy. It can continue to last for some time but a reversal will come. If you think otherwise then go short with high leverage on bitmex. Easy money eh?
My "fundamental" thoughts have been, and will remain, that this bearish channel will continue til 1 of the following 3 catalysts take place and break the bear channel back into a sustained uptrend.
(1) A major currency shock happens globally and there is a rush into buying long term "call-options" on perceived safe liquidity assets such as crypto and gold/silver. I say call-options basically meaning that the buyer would be buying and "HODL'ing" as they say over an extended time period horizon until fear abates.
(2) ETFs/Trusts created on retail Broker Dealer exchanges that would soak up institutional demand and retirement accounts, in addition to boomer funds (who would comprise the primary source of funds to drive the biggest wave). Our last boom in crypto was primarily driven by credit card buying sprees by millenials. You can derive this by simply looking at the polls done on who actually bought this stuff (hint: it was all done by millenials, who don't have any real source of savings to do this to begin with)
(3) A new form of the technology comes to market that completely revolutionizes the way we look at and/or use the blockchain technology. This would bring institutional money/hedge funds back into the space with money also geared toward marketing the product(s) and bringing new investment. This could be coming in the form of the new platforms built by the SEC to allow ICOs to launch for asset backed investment in small cap companies (see Kevin O'Leary's recent discussion around ICO on real estate via CNBC on Mar 19).
In my personal opinion, I think the next leg will get triggered when Hashgraph actually launches something for public participation. I believe the actual interest begins to cultivate on a larger scale due to what it's capable of doing. It goes beyond just the blockchain itself and brings the whole idea of Trust on the internet to a whole new level. For this reason, I continue to spend my alternative time/resources studying hashgraph for when that might take place and welcome criticisms...
MrRenev
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Totally agree with what you say. I think we'll go lower thought, into very attractive buying zones.
raghavgrover013
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I am looking at this long term trend line and this looks very interesting. I opened a long position with a tight stop and new buy limit orders. Even i am thinking low would be around 420's but you never know if this market make even worse extreme moves and take it even lower.