Market Overview: Conflux/Tether (CFXUSDT)

• Price dropped from 0.1265 to 0.1113 over 24 hours, ending at 0.1132, signaling bearish momentum.
• Strong bearish divergence seen in closing prices versus RSI, hinting at potential exhaustion.
• Volumes spiked during the rally to 0.1265 but dropped sharply during the decline, suggesting lack of follow-through.
• Price consolidated around 0.113–0.114 after the drop, forming potential near-term support.
• Volatility remains high, with frequent swings between 0.111 and 0.126 in the 24-hour period.

The 24-hour period for Conflux/Tether (CFXUSDT) began with an open of 0.1170 at 12:00 ET−1 and reached a high of 0.1265 before declining to a low of 0.1107 and closing at 0.1132 at 12:00 ET today. Total volume amounted to 395,426,933.0 units, with notional turnover at 45,470.80 USD. The price action over the past day reflects a bearish reversal, with momentum indicators hinting at a potential pause in the downward trend.

Structure & Formations

Price action revealed a sharp bearish swing from 0.1265 to 0.1107, forming a potential bearish flag pattern between 0.113 and 0.114 as a consolidation area. Key support levels to watch include 0.113, 0.112, and 0.111, while resistance is expected at 0.114–0.115. Several engulfing bearish candles appeared during the decline, confirming downward pressure. A doji near 0.1131 suggests indecision and potential reversal at this level.

Moving Averages

On the 15-minute chart, the 20-EMA and 50-EMA remained in a bearish crossover, reinforcing the downward trend. On the daily chart, the 200-SMA appears to act as a key resistance above the 0.116–0.118 range. If the price can hold above the 50-SMA at approximately 0.115–0.116, it may signal a temporary pause in the downtrend.

MACD & RSI

The MACD remained bearish throughout the day, with the histogram showing narrowing bearish momentum as price approached 0.113. The RSI-14 dropped to oversold territory below 30 during the consolidation phase, suggesting the price could be due for a countertrend bounce. However, the divergence between price and RSI during the decline raises questions about the strength of the bounce. A sustained move above 0.1145 would be needed to confirm bullish momentum.

Bollinger Bands

Volatility was elevated for much of the period, with the Bollinger Bands expanding to a 2.5% width. Price briefly touched the lower band at 0.1107, confirming a potential short-term oversold level. As volatility has since contracted, the price has moved closer to the middle band, indicating a possible period of consolidation. A breakout above the upper band would require renewed buying pressure.

Volume & Turnover

Volumes spiked during the rally to 0.1265 but sharply declined during the drop, suggesting a lack of conviction among sellers. Turnover remained relatively stable, with no significant divergence between price and volume. The most recent consolidation phase saw moderate volume, indicating a potential equilibrium in buying and selling pressures.

Fibonacci Retracements

Applying Fibonacci retracement levels to the swing from 0.1107 to 0.1265, key levels to watch include the 38.2% at 0.1169 and 61.8% at 0.1140. The current price is near the 61.8% level, which may act as a pivot point. A break above 0.1169 could trigger a test of the 78.6% retracement at 0.1175, which overlaps with the 20-EMA.

Backtest Hypothesis

To validate the potential for a countertrend bounce, a backtest using a RSI-based mean reversion strategy could be effective. The strategy could involve entering long positions when RSI-14 crosses below 30 (oversold) and closing when it crosses back above 50, or when price breaks a key Fibonacci or moving average. Given the current price hovering near the 61.8% retracement and RSI in oversold territory, this setup aligns well with the strategy’s assumptions. A robust backtest would need historical RSI-14 data to refine entry/exit rules, which we can execute once the data is available.