✊ Here we go. Night dump, part 1: view from TA and sentiment perspective

Last night I sent a pattern on $ETH to one of the team members. The picture was clearly shaping up for a SHORT position. Numerous rejections at the high of the range and aggressive dumps followed by accumulation of liquidity and lows.

The price seemed ready to break through the downtrend line. I didn't enter into a SHORT position because such patterns require more thorough analysis. And I saw this situation literally within 5m. So I decided to take a wait-and-see approach and observe the market.

The most I expected was a breakdown of the trendline, some liquidity collection near the lows, a rejection at $2500, and then a buyback. But the reality turned out to be much worse.

Not only did the price break through the trendline and lows, but it started an uncontrolled drop typical of an 🐻 aggressive bearish market. Why this happened, I'll explain in my next post.

In this one, I'm trying to explain everything from a technical standpoint. Next, I'd like to draw your attention to the Fear & Greed Index (CoinMarketCap).

To my great surprise, even after the ⚪️ February 3rd dump, CMC showed a zone of 39-40. Moderate fear bordering on neutrality. How could that be after such a brutal drop of ETH to $2200? Could there really have been no capitulation, and are we not yet at the bottom? Yet the index doesn't lie.

👹 Apparently, based on this data, MM decided that markets weren't scared enough and needed to descend into real fear territory rather than stay neutral. As a result, via CMC, we got a zone of 29 — strong fear verging on extreme. On other platforms, the index is even lower.

This already looks like true capitulation and the bottom. The index entered the 29 zone when ETH was at $2500. I don't know what it was at $2300. But the fact remains: such terrible sentiment has only occurred during bear markets, as well as on August 5th and September 7th, 2024. I remember those days very well too. The situation and prices were similar back then.

Back then, everyone