Spell Token Surges 17.05% in 24 Hours Amid Technical Downtrend

On SEP 1 2025, the price of SPELL surged by 17.05% within 24 hours, closing at $0.0005018. Despite the short-term rally, the token has recorded a 683.98% drop over seven days, 204.29% over one month, and a staggering 3635.38% decline over the past year. The sharp recovery in the last day has drawn attention to potential reversals, though the broader bearish trend remains intact.

Technical indicators suggest a continuation of bearish momentum. The 50-day and 200-day moving averages remain well above current prices, confirming a long-term downtrend. The Relative Strength Index (RSI) has recently moved into the oversold territory, signaling a potential short-term bounce. However, the Moving Average Convergence Divergence (MACD) remains in negative territory, with the histogram shrinking, indicating weakening downward momentum. Traders are closely watching whether the 24-hour surge can trigger a broader near-term rebound or if it will be short-lived amid ongoing bearish sentiment.

Despite the recent price action, analysts project that the broader market conditions are unlikely to support a sustainable reversal in the near term. The short-lived 17.05% gain may be interpreted as a correction rather than a trend reversal, especially given the token’s significant decline over the past several months. Investors are advised to remain cautious and monitor key support levels for potential buying opportunities.

Backtest Hypothesis

A hypothetical backtesting strategy has been proposed to evaluate the performance of a trading model based on technical indicators. The model assumes that a buy signal is triggered when the RSI falls below 30 and the MACD histogram turns upward. A sell signal is generated when the RSI rises above 70 or when the price breaks below the 50-day moving average. This strategy aims to capture short-term rebounds in a bearish trend, leveraging oversold conditions to identify potential entry points before resuming the downward trend.

The strategy also incorporates a stop-loss at a fixed percentage below the entry price to mitigate downside risk in case the anticipated rebound does not materialize. Traders using this approach would aim to close positions once the RSI indicates overbought conditions or when the MACD confirms a bearish crossover. While backtesting cannot predict future performance, this model provides a structured framework for evaluating the short-term behavior of assets like SPELL under defined technical conditions.