Market Overview for Convex Finance/Tether (CVXUSDT) – 2025-10-06

• Price dropped sharply from $3.72 to $3.60 before rallying to close near $3.71.
• High volume confirmed the morning sell-off but faded during the afternoon recovery.
• RSI and MACD show mixed momentum, suggesting a possible consolidation phase.
• Volatility expanded during the 12-hour overnight decline and partially contracted after the rebound.
• Key support at $3.64 held during the selloff, but a bullish engulfing pattern formed on the 15-min chart near the close.

Convex Finance/Tether (CVXUSDT) opened at $3.708 on 2025-10-05 at 12:00 ET, reached a high of $3.806 and a low of $3.579, and closed at $3.773 as of 2025-10-06 at 12:00 ET. Total trading volume amounted to 208,396.39 units with a notional turnover of $768,749.43 over the 24-hour period.

Structure & Formations

The 15-minute chart shows a sharp sell-off from mid-overnight through 4:00 AM ET, with the price dropping from $3.66 to $3.60 on increasing volume. This was followed by a consolidation phase and a late-day recovery, forming a small bullish engulfing pattern near the close. A notable bearish 3-candle reversal pattern (shooting star, spinning top, and a down candle) appeared during the early morning hours, signaling a key turning point. The immediate support level appears to be at $3.64, with resistance forming at $3.72 after multiple retests.

Moving Averages

On the 15-minute chart, the 20-period MA crossed above the 50-period MA in the early morning, suggesting a short-term bearish trend, but the 50-period MA has started to turn upward, indicating a potential reversal. On the daily chart, price is above both the 50-day and 200-day MAs, which is a bullish sign for the long-term trend. However, the 100-day MA is approaching from below and may provide resistance in the near term.

MACD & RSI

The MACD line turned positive in the late afternoon, confirming the short-term reversal, while the histogram showed a tightening of bearish momentum as the price recovered. RSI has rebounded from oversold territory (30) to a neutral 52 at the close, suggesting the selloff may be subsiding. However, RSI remains below overbought levels, indicating room for further upside, though with caution.

Bollinger Bands

The 20-period Bollinger Bands widened significantly during the morning selloff, reaching a volatility expansion phase. Price bottomed near the lower band at $3.60, suggesting a potential rebound. Since the late afternoon, volatility has contracted and price has remained within the bands, with the upper band forming a potential resistance zone at $3.73.

Volume & Turnover

Volume spiked during the early morning selloff, with the highest volume candle at 4:15 AM ET showing 33,655.10 units traded. However, volume declined significantly during the afternoon recovery, raising questions about the strength of the reversal. Notional turnover also peaked during the selloff and has since fallen off, indicating a potential exhaustion of the downward move. There is no clear divergence between price and turnover at this time, but volume may need to increase to confirm a sustainable bullish breakout.

Fibonacci Retracements

Applying Fibonacci to the overnight selloff from $3.72 to $3.60, the 38.2% retracement is at $3.68 and the 61.8% retracement is at $3.65. Price has already tested $3.68 and is currently consolidating just above the 50% level at $3.66. On the daily chart, the 38.2% retracement of the recent larger bearish leg is at $3.74, which appears to be a key area of resistance.

Backtest Hypothesis

The backtesting strategy described involves entering long positions when price breaks above a dynamic resistance level formed by the 20-period high and retests on a 15-minute chart, confirmed by a bullish candlestick pattern and rising RSI. The risk management component includes setting a stop-loss at the 50-period low and taking profit at the 61.8% Fibonacci level. This approach aligns with the current price action, as CVXUSDT has shown multiple retests of key levels and has developed a potential bullish pattern near the close. A test of this strategy could be conducted by applying it to the current daily and 15-minute setup, using the recent $3.64 support as a stop and $3.72 as a target.