Chainlink/Tether (LINKUSDT) Market Overview

• Price action saw a sharp decline from $18.48 to $16.91 on heavy volume.
• RSI and MACD signaled oversold conditions by the end of the session.
• Volatility expanded significantly, with Bollinger Bands widening through the 24-hour period.
• Notable divergence emerged between price lows and volume in the final 4 hours of trade.

Chainlink/Tether (LINKUSDT) opened at $18.04 on 2025-10-29 at 12:00 ET and closed at $16.91 at 12:00 ET the following day. The pair traded between a high of $18.48 and a low of $16.85, reflecting heightened volatility. Total volume for the 24-hour period amounted to 2,657,994.39 units, with a notional turnover of approximately $47.1 million, based on the weighted average of 15-minute price intervals.

The 15-minute chart revealed a sharp bearish thrust following the 18:45 ET candle on 2025-10-29, which saw a nearly 6% drop to $17.54. This move was confirmed by a bearish engulfing pattern and a long lower shadow, signaling capitulation. The price then continued to depreciate in a broad downtrend, with support levels forming around $17.60–17.65 and $17.40–17.45, both of which were tested and broken. Resistance on the upside remains intact at $18.15–18.25 and $18.40–18.45, where the price stalled multiple times during the early hours.

Bollinger Bands showed a marked expansion during the bearish phase, with price often sitting near the lower band. The 20-period and 50-period moving averages crossed into bearish territory, confirming a shift in trend. On the 1-hour chart, the 50-period SMA broke below the 200-period SMA, forming a death cross. This bearish alignment was reinforced by a MACD crossover into negative territory and an RSI dip below the 30 oversold threshold. The RSI, however, did not remain in oversold for long, indicating a potential for a short-term bounce or consolidation.

Fibonacci retracement levels drawn from the $18.48 high to the $16.91 low placed key levels at $17.48 (38.2%) and $17.17 (61.8%). These levels coincided with temporary bounces, suggesting potential near-term support for buyers. Divergence between price and volume became apparent in the final 4 hours of trade, with volume declining as price hit new lows, hinting at waning bearish momentum. While the near-term bias remains bearish, a rebound from the 61.8% level could trigger a short-covering rally.

Backtest Hypothesis
Given the recent bearish momentum and oversold RSI conditions observed during the 24-hour period, a simple RSI-based backtesting strategy could be evaluated for its effectiveness in capturing short-term reversals. Using the standard 14-period RSI and a 30 oversold threshold, the strategy would generate buy signals when RSI falls below 30 and hold for five trading days. The use of daily close prices for entry and exit aligns with standard practice and ensures consistency. In the absence of additional risk controls, the backtest will provide a baseline for performance during both trending and range-bound periods from 2022-01-03 to 2025-10-30. This approach could help quantify the utility of RSI in signaling potential short-term rebounds in LINKUSDT.