Market Overview for IOTA/Tether (IOTAUSDT) - 2025-11-01

• IOTA/Tether traded lower, forming a bearish breakdown below key support
• Volatility increased as price fell to a 3-week low amid declining volume
• Momentum indicators point to oversold territory, but trend remains bearish
• Bollinger Band contraction suggests potential for a breakout or breakdown
• Turnover diverged with price, hinting at possible accumulation or capitulation

IOTA/Tether (IOTAUSDT) opened at 0.139 on 2025-10-31 12:00 ET and closed at 0.1396 on 2025-11-01 12:00 ET, with a high of 0.1405 and a low of 0.1354. Total volume for the 24-hour period was approximately 8,267,031 IOTA, while turnover (notional value) totaled $1,153,295, based on the OHLCV data provided. Price action showed a sharp bearish reversal from 0.139 to 0.1356 before recovering modestly in the final hours.

Over the 24-hour period, IOTAUSDT formed multiple bearish patterns, including a strong bearish engulfing pattern between 16:00 and 16:15 ET and a deep bearish trend confirmed by a key breakdown under 0.1375. The formation of a bearish channel and a lower low on increasing volume suggests strong distribution or bearish momentum has taken hold. On the 15-minute chart, the 20-period and 50-period moving averages have both crossed below the price, indicating a bearish bias in the short-term.

Momentum indicators confirmed the bearish bias. The 12/26 MACD line crossed below the signal line, forming a bearish crossover as bullish momentum faded. The RSI hovered near oversold levels (28–32) in the final hours, suggesting potential exhaustion of the bearish move, though a bearish divergence in price and RSI suggests further downward momentum could follow. Bollinger Bands showed a recent contraction from 0.1375 to 0.1385, indicating a possible period of consolidation before a larger move could occur.

Price appears to be testing key support levels at 0.1375 and 0.1354, with a breakdown below 0.1354 likely to trigger a move toward 0.1340. Resistance levels are forming around 0.1390 and 0.1400, with a retest of 0.1405 possible if a short-term bounce occurs. Fibonacci retracement levels on the 15-minute chart suggest that 0.1378 (38.2%) and 0.1364 (61.8%) are key psychological levels to watch. A recovery above 0.1405 could signal a short-term reversal, but for now, the bias remains bearish.

The backtest hypothesis is based on a simple trend-following strategy using bullish engulfing candlestick patterns as entry signals and a 5-day fixed-holding period for exits. Over the backtest period from 2022-01-01 to 2025-11-01, the strategy underperformed the market, with a total return of -7.5%, an annualized return of 3.1%, and a maximum drawdown of -65.9%. The frequent small losses and large drawdowns indicate that the fixed-holding approach is not optimal for this asset or pattern. Key insights from the backtest suggest that the strategy could be improved by incorporating a trailing stop-loss or trend confirmation filters, such as ensuring price is above the 50-day moving average before taking a trade. The poor Sharpe ratio (0.10) indicates that the risk-adjusted return is unattractive for most investors.