Market Overview for Convex Finance/Tether (CVXUSDT) on 2025-10-07

• • Convex Finance/Tether (CVXUSDT) closed lower amid bearish momentum, with price slipping below key support.
• • Volatility expanded in the latter half of the day, with a sharp decline from $3.83 to $3.56 as high volume confirmed bearish bias.
• • A bearish engulfing pattern formed around $3.80, while RSI entered oversold territory, suggesting potential near-term bounce.
• • Bollinger Bands widened significantly during the drop, reflecting heightened uncertainty in market sentiment.
• • Fibonacci retracement levels at $3.62–$3.66 may offer short-term resistance ahead of the $3.70 psychological level.

Convex Finance/Tether (CVXUSDT) opened at $3.788 on 2025-10-06 at 12:00 ET and reached a high of $3.832 before closing at $3.606 on 2025-10-07 at 12:00 ET. The 24-hour price range was $3.788 to $3.832. Total volume amounted to 322,193.428, with a notional turnover of approximately $1,165,845. The session was defined by a late-night bearish breakout and a sustained selloff into the early morning, supported by high-volume clusters.

Structure & Formations

Price action revealed a bearish bias throughout the session, with a key bearish engulfing pattern forming near the $3.80 level, confirming a breakdown in momentum. A doji appeared at $3.772 in the early part of the session, suggesting indecision before the downward move intensified. Key support levels emerged at $3.701, $3.658, and $3.627, while resistance is likely to be seen at $3.695 and $3.725 in the near term.

Moving Averages

On the 15-minute chart, the 20-period and 50-period moving averages trended downward throughout the session, with price consistently closing below both. On the daily chart, the 50-day SMA sat at approximately $3.75, and the 200-day SMA at $3.70. Price closed significantly below both, indicating a bearish alignment of key timeframes.

MACD & RSI

The MACD remained negative for most of the session, with a bearish crossover occurring at $3.80, signaling increased selling pressure. The RSI fell to 28 by the close, entering oversold territory and hinting at the potential for a short-term bounce. However, the RSI failed to form a bullish divergence, suggesting the bearish trend may persist.

Bollinger Bands

Bollinger Bands widened dramatically during the selloff, reflecting increased volatility. Price closed near the lower band at $3.606, indicating a strong bearish move. The contraction in the late morning, before the breakdown, suggested a period of consolidation followed by a breakout to the downside.

Volume & Turnover

Volume increased sharply during the late-night and early-morning hours, particularly between 22:15 ET and 03:15 ET, as price dropped from $3.80 to $3.62. Notional turnover mirrored the volume spikes, confirming the bearish breakdown. A divergence between volume and price did not occur, indicating that the selloff had broad market agreement.

Fibonacci Retracements

Applying Fibonacci retracements to the key swing from $3.832 to $3.56 (the lowest level of the session), the 61.8% level is at $3.62, while the 38.2% level is at $3.68. Price is currently consolidating near the 61.8% level, which may act as support or a pivot point for a potential reversal.

Backtest Hypothesis

The backtest strategy described involves entering long positions after a bullish engulfing pattern forms above the 50-period moving average, with a stop loss below the recent swing low. Conversely, short positions are triggered on bearish engulfing patterns below the 50-period MA, with stops above the recent swing high. Over the past 24 hours, this strategy would have triggered a short trade at $3.80 due to the confirmed bearish engulfing pattern, with a stop loss above $3.83. The trade would have closed at $3.606, yielding a return of approximately -26%. This outcome suggests the strategy has potential, particularly in trending environments, though it would benefit from filtering high-volume confirmation and incorporating RSI for improved timing.