Market Overview for Chainlink/Tether (LINKUSDT) - October 7, 2025

• Price dipped 7.7% in 24 hours, closing at 22.00 after a sharp selloff in the late afternoon ET
• Momentum turned bearish with RSI below 30 and MACD diverging
• Volatility expanded with Bollinger Bands widening during the selloff
• Volume surged during the downtrend, confirming bearish pressure
• A key support level appears near 21.84 as price approaches it

Chainlink/Tether (LINKUSDT) opened at 22.80 on October 6 at 12:00 ET, reached a high of 23.73, and closed at 22.00 at 12:00 ET on October 7, down 7.7%. Total volume was 16,084,036.75 and notional turnover amounted to approximately $357,053,959. The 24-hour price action was characterized by a sharp bearish reversal in the late afternoon, with a strong continuation of downside momentum.

Structure & Formations

Price formed a bearish engulfing pattern from 22.05 to 22.18 at 15:00–15:15 ET, confirming a breakdown. A long lower shadow appeared around 22.25, but failed to hold. A key support level was identified near 21.84, where sellers appear to be defending. Resistance is likely near 22.68, a prior pivot level on the 15-minute chart, which may offer buyers a short-term ceiling.

Moving Averages

On the 15-minute chart, the 20SMA crossed below the 50SMA in the afternoon, confirming bearish momentum. For daily timeframes, the 50DMA has crossed below the 200DMA, indicating a medium-term bearish trend. Price is currently trading below both the 50DMA and 200DMA, which could reinforce the bearish sentiment unless a strong reversal is seen.

MACD & RSI

MACD turned negative in the late morning and continued to diverge, with a bearish crossover of the signal line. RSI dropped below 30 by 15:45 ET, suggesting oversold conditions, but bearish momentum remains intact. RSI failed to rebound above 40 after the initial bearish move, implying further downside could follow. Traders should watch for a potential rebound if RSI rises above 40 without a significant volume increase.

Bollinger Bands

Volatility expanded significantly during the selloff, with Bollinger Bands widening to accommodate the sharp drop. Price closed below the 20-period lower band, indicating extreme bearish pressure. A contraction in the bands may occur if price stabilizes, but the current wide range suggests uncertainty and potential for further drawdowns.

Volume & Turnover

Volume spiked during the selloff, with the largest 15-minute candle (amounting to $3,192,809) at 14:15–14:30 ET, during which price dropped from 22.48 to 22.32. Notional turnover also surged during this time. Price and turnover aligned during the bearish move, confirming strength in the downtrend. A divergence could signal a potential reversal if volume fails to support a new move.

Fibonacci Retracements

Applying Fibonacci to the 24-hour swing from 23.73 to 21.90, 21.96 aligns with the 61.8% retracement level, which coincided with a key support zone. The 38.2% level (22.38) failed to hold, indicating strong bearish pressure. On the 15-minute chart, the 61.8% retracement of the 23.00–22.52 swing is at 22.68, a potential short-term resistance.

Backtest Hypothesis

A potential backtesting strategy involves entering short positions when RSI falls below 30 on the 15-minute chart and MACD crosses below the signal line, with a stop-loss at the most recent higher high (e.g., 22.79). A take-profit target could be set at the 61.8% Fibonacci retracement level (21.96). This setup is most effective when confirmed by high volume and price below the 20SMA. Given the current environment, this strategy could yield favorable risk-reward ratios, particularly if the downtrend continues.