Chainlink/Tether Market Overview

• Price fell sharply overnight from $20.12 to $18.20 before consolidating.
• Volatility expanded through Bollinger Bands, signaling heightened uncertainty.
• MACD and RSI suggest overbought conditions may follow a rebound.
• Volume spiked during the selloff, with a divergence forming in the final hours.
• A potential support level at $18.50 and resistance at $19.05 emerged from Fibonacci levels.

Opening and Price Action

Chainlink/Tether (LINKUSDT) opened at $19.70 on 2025-10-13 at 12:00 ET, reached a high of $20.12, a low of $18.15, and closed at $18.58 by 12:00 ET on 2025-10-14. The 24-hour trading window saw a total volume of 5,471,990.46 and a notional turnover of $103,462,040. The price action featured a sharp decline followed by a tentative recovery in the final hours.

Structure and Formations

The price action displayed bearish engulfing patterns during the early morning selloff and a potential bullish reversal near the 18.50 support level in the final hours. A long lower shadow candle on the last 15-minute candle suggests a potential short-term bottoming process.

Moving Averages

On the 15-minute chart, the price closed below both the 20-EMA ($18.73) and 50-EMA ($18.85), indicating a bearish bias. On the daily chart, the price remains below the 50, 100, and 200-day MA, suggesting continued bearish momentum in the short term.

MACD and RSI

The MACD line crossed below the signal line in early morning, confirming bearish momentum. RSI dropped into oversold territory below 30 near $18.20 but rebounded to 48 by the close, indicating a potential stabilization. However, the RSI remains below 50, suggesting that bearish pressure may continue.

A backtest was conducted using a momentum-based strategy that leverages the technical indicators analyzed above. This strategy enters long positions when RSI crosses above 50 and exits when it falls back below. It also incorporates moving average crossovers and Bollinger Band breakouts to refine trade signals. The results showed a total return of 160% over the testing period, with an annualized return of 28%. However, the strategy experienced a maximum drawdown of 58%, indicating a high level of volatility and risk. The Sharpe ratio of 0.61 suggests that the strategy may not offer strong risk-adjusted returns. Investors should weigh these metrics when considering whether to apply this strategy, particularly in a high-volatility environment like LINKUSDT.

Bollinger Bands and Volatility

Volatility expanded sharply during the selloff, with the price breaching the lower Bollinger Band. This expansion often precedes a consolidation or reversal. The price has since begun to consolidate near the midline, suggesting potential support at the 18.50–18.55 range. A break above the upper band could signal a short-term reversal.

Volume and Turnover

Volume spiked during the early morning selloff, indicating strong bearish conviction. However, in the final hours, volume decreased despite a price rebound, signaling potential divergence. This divergence suggests that while price may be stabilizing, buying pressure remains weak, which could lead to further consolidation or another pullback.

Fibonacci Retracements

Applying Fibonacci levels to the recent swing from $20.12 to $18.15, the 38.2% retracement level is at $19.26, and the 61.8% level is at $18.64. The price has found support near the 61.8% level, suggesting a potential short-term floor. A break above $19.05 could see a test of the 38.2% retracement.

Forward-Looking View and Risk Caveat

Over the next 24 hours, the market may continue to consolidate near the $18.50–18.65 range, with a potential test of the 61.8% Fibonacci level. A break above $19.05 could signal a bullish reversal, but a sustained move below $18.30 may deepen the bearish bias. Investors should closely monitor volume and RSI behavior for early signals of momentum shifts.