Market Overview for Avalanche/Tether (AVAXUSDT) – 2025-10-24

• AVAXUSDT opened at $19.54, traded between $18.98 and $19.96, and closed at $19.26 with a 24-hour volume of 228,950.75.
• A sharp bearish reversal unfolded after a bullish surge to $19.96, with price retreating below 50-period moving average.
• MACD turned bearish and RSI hit overbought levels, now correcting into oversold territory with fading momentum.
• Volatility expanded during the bearish leg, with price testing key Fibonacci levels at 61.8% and 78.6% of the recent high.
• Bollinger Bands widened during the selloff, suggesting heightened uncertainty and potential for consolidation or continuation.

Avalanche/Tether (AVAXUSDT) opened at $19.54 on October 23, 2025, and closed at $19.26 at 12:00 ET on October 24. During the 24-hour period, the pair reached a high of $19.96 and a low of $18.98. Total volume traded was 228,950.75, with a notional turnover of approximately $4,404,069.93.

The price action showed a strong bullish push to the high of $19.96, followed by a bearish reversal that took the pair back below critical moving averages. The 15-minute chart saw several key support levels tested, including the 20- and 50-period moving averages. The 20-period MA was at around $19.65, while the 50-period MA was at $19.50. The daily chart showed the 50- and 200-period MAs at $19.35 and $19.15 respectively, with price now consolidating near the 200-day MA.

The MACD line crossed below the signal line around $19.50, confirming bearish momentum, while RSI dropped from overbought levels above 70 to around 30 in the last 4 hours, suggesting a possible oversold bounce. Bollinger Bands expanded significantly during the selloff, with price bouncing near the lower band at $18.98. Price action also hit key Fibonacci retracement levels at 61.8% ($19.26) and 78.6% ($19.13), which may offer potential support or resistance in the near term.

The candlestick patterns during the bearish leg included several bearish engulfing patterns, especially between 19:00 ET and 21:00 ET, which confirmed the shift in sentiment. A long lower shadow appeared during the 04:30 ET to 05:00 ET period, indicating rejection at higher levels. Volume surged during the bearish phase, confirming the strength of the sell-off. However, volume has started to contract on the recent leg down, which could indicate a potential near-term bottom or consolidation.

Backtest Hypothesis

Given the observed bearish reversal patterns and the technical setup, a backtesting strategy could be constructed using the Bearish Engulfing candlestick pattern as an entry signal, triggered when it occurs near a defined support level. For the support level definition, a swing low pivot—specifically the most recent swing low—would be a logical choice, as it aligns with the observed Fibonacci retracement levels and Bollinger Band behavior.

A suitable backtest could focus on AVAXUSDT over the period from January 1, 2022, to October 24, 2025, identifying all instances where a Bearish Engulfing candle appears at or near a swing low. For each confirmed signal, a short entry could be triggered, with a stop-loss placed above the recent high of the engulfing candle and a take-profit target set at a fixed 38.2% Fibonacci level or the lower Bollinger Band. This would allow us to evaluate the viability of a mean-reverting strategy on AVAXUSDT during bearish setups.