Dego Finance/Tether Market Overview

• DEGOUSDT experienced a sharp selloff from $2.22 to $1.26, a 43% decline within 13 hours.
• Key support tested at $1.12–$1.15, with price rebounding from oversold RSI levels.
• Volatility spiked as volume surged 10x during the downward move, confirming bearish momentum.
• Bollinger Bands show widening volatility, with price now near the 20-period lower band.
• Recent candlestick patterns indicate short-term exhaustion at $1.27–$1.12, with possible consolidation ahead.

Dego Finance/Tether (DEGOUSDT) opened at $2.06 on 2025-10-26 12:00 ET, reached a high of $2.22, and a low of $1.15 before closing at $1.12 at 12:00 ET the next day. Total volume for the 24-hour period was ~11.8 million, and notional turnover was ~$27.1 million. A sharp bearish reversal unfolded from mid-night onward as sellers overwhelmed buyers.

Structure & Formations

Price action revealed a bearish breakdown from a short-term ascending triangle pattern formed between $2.05 and $2.14. A large bearish engulfing candle at 00:00 ET marked the beginning of the selloff. Subsequent price action showed a series of spinning tops and hanging men candles between $1.50 and $1.20, suggesting indecision and a potential short-term bottoming process. A key support level appears to be forming around $1.12–$1.15, as evidenced by multiple closes near this range and a bullish rebound off it.

Moving Averages

On the 15-minute chart, the 20-period and 50-period SMAs both acted as resistance during the selloff, with price falling below both. The 200-period daily SMA, if plotted, would likely sit near $1.75–$1.80, suggesting a strong bearish bias from a longer-term perspective. On the 1-hour chart, price is currently below all major moving averages, indicating a continuation of bearish momentum unless a strong reversal occurs.

MACD & RSI

The RSI indicator reached oversold levels (~30) near $1.15–$1.12, indicating potential for a short-term bounce. The MACD line moved below the signal line early in the selloff and has remained negative, suggesting ongoing bearish momentum. However, a slight positive divergence between the MACD and price near the lows hints at possible exhaustion in the downtrend.

Bollinger Bands

Bollinger Bands show a significant expansion during the selloff, with price dropping below the lower band on multiple occasions. This reflects heightened volatility. A rebound near the lower band between $1.20 and $1.15 suggests that volatility is now narrowing slightly, a potential precursor to a short-term consolidation phase.

Volume & Turnover

Volume spiked dramatically during the selloff, particularly around 00:00–03:00 ET when price dropped from $2.22 to $1.39 in just 3.5 hours. This high-volume move confirmed bearish conviction. Notional turnover also spiked during this period, exceeding $15 million between 00:00 and 03:00 ET, reinforcing the strength of the selloff. Recent volume has declined, indicating possible exhaustion of the move lower.

Fibonacci Retracements

Applying Fibonacci retracement levels to the recent swing from $2.22 to $1.15, price found support at the 61.8% level (~$1.60) before falling further, and again at the 38.2% level (~$1.40). The recent bounce near $1.12–$1.15 could be seen as a test of the 23.6% level (~$1.27), which appears to be the next potential target for a short-term bounce if buyers re-enter.

Backtest Hypothesis

Given the recent breakdown and potential exhaustion in the bearish momentum, a backtest could be structured to evaluate a long entry at $1.12–$1.15 with a stop below $1.08 and a target of $1.27–$1.32. To implement this, RSI can be manually calculated from the provided OHLCV data using a 14-period RSI formula, and the trade signal would be triggered on a close above the 15-minute 20-period SMA. This approach aligns with the observed rebound and divergence in the momentum indicators.