FORMUSDC Market Overview: Volatile 24-Hour Move with Divergence and Pullback

• Price surged past key resistance levels with strong bullish momentum after early session consolidation
• Volatility expanded significantly during the Asian session, with price fluctuating over 12% in a 4-hour window
• Final 6-hour session saw reduced momentum and a pullback toward the 20-period moving average
• On-balance volume suggests buying pressure was uneven, with high turnover diverging at peak highs
• RSI entered overbought territory twice, failing to confirm strong bullish continuation

The Four/USDC (FORMUSDC) trading pair opened at 1.1154 on 2025-10-05 12:00 ET and surged to a high of 1.37 before retreating to a low of 1.0664 during the 24-hour period. It closed at 1.1029 at 2025-10-06 12:00 ET. Total trading volume reached 1,579,981.1 and notional turnover totaled 1,746,045.99, reflecting high liquidity and trader interest.

Structure and formations revealed multiple key levels: a strong resistance at 1.37 and support at 1.0664. A long bullish candle confirmed the 1.37 level, followed by a bearish engulfing pattern at the peak. Mid-day consolidation formed a small bearish rectangle between 1.18–1.22. A doji near the session close at 1.1029 indicated indecision.

The 20-period moving average acted as a dynamic support during the final 6-hour session, while the 50-period line remained below the price. The 200-period MA was bearish, suggesting long-term bears could still dominate unless the price breaks decisively above 1.25. Bollinger Bands widened significantly during the Asian session, with price reaching the upper band before retreating. Volatility then contracted, with price settling inside the bands during the final 6 hours.

MACD diverged at the peak, with the line falling below the signal line while price continued higher, indicating weakening momentum. RSI entered overbought territory at 1.37 and again at 1.25, failing to confirm strong continuation. The oscillator then dropped below 50, suggesting bearish pressure had resumed. Volume surged during the initial breakout but declined during the pullback, indicating possible exhaustion in the bullish wave.

Fibonacci retracement levels from the 1.0664 low to 1.37 high highlighted 61.8% at 1.24 and 38.2% at 1.198, where the price consolidated for several hours. The 50% retracement at 1.2175 acted as a minor resistance before the final pullback. These levels remain relevant as possible support/resistance in the near term.

Backtest Hypothesis: A potential strategy could involve using the 20-period moving average as a dynamic support level, combined with RSI divergence and volume confirmation. If the price breaks above 1.24 (61.8% retracement) with increasing volume and RSI above 55, it may signal a continuation phase. Alternatively, a short setup may form if the price breaks below the 1.1821 support with divergent RSI and declining volume, aligning with the bearish engulfing pattern observed at the peak.