Market Overview for Pepe/Tether (PEPEUSDT) - 2025-10-04

• Price declined from $1.039 to $9.69e-06, forming bearish engulfing and bearish harami patterns.
• Momentum weakened with RSI dropping below 30, signaling oversold conditions.
• Volatility expanded, with price breaking below the Bollinger Bands lower band.
• High volume observed in the early decline, with turnover peaking at $947.8B in one 15-minute interval.
• 20SMA and 50SMA both bearish, reinforcing a downward trend in short-term sentiment.

The 24-hour session for Pepe/Tether (PEPEUSDT) started at $1.017e-05 and ended at $9.69e-06 at 12:00 ET. The high reached $1.04e-05, while the low dropped to $9.68e-06. Total volume was 3.988e+12 units, and notional turnover amounted to approximately $40.79B. The price action exhibited a strong bearish bias, with notable support emerging around $9.68e-06 and resistance at $1.015e-05.

Structure and formations indicate that the price has been consolidating within a descending channel, with bearish engulfing patterns observed during the early part of the session. A bearish harami at $1.018e-05 confirmed the lack of bullish conviction. Key support levels appear at $9.85e-06 and $9.68e-06, with the former showing multiple bounces. Resistance is expected to be met near $1.015e-05 and $1.03e-05 as retracement levels.

The 20-period and 50-period simple moving averages on the 15-minute chart both remain below the price, confirming the bearish trend in the short term. The 50-period line is particularly bearish, crossing below the 100- and 200-period lines on the daily chart, indicating a broader bearish momentum. The price has also tested the 61.8% Fibonacci level from the previous major high at $1.04e-05, currently at $9.88e-06, which acted as a minor support.

The RSI has fallen below the 30 threshold, indicating oversold conditions, but divergence is not yet evident between price and momentum. MACD remains negative, with a bearish crossover observed earlier in the session, reinforcing the downward pressure. Bollinger Bands show a recent expansion, with the price settling below the lower band for extended periods, suggesting heightened volatility. Traders should be cautious, as a rebound from $9.68e-06 could see price testing the 38.2% retracement level at $9.95e-06. A sustained break below the current support could lead to further downside toward $9.5e-06, with increased risk of a short-term correction.

Backtest Hypothesis

Applying a backtesting strategy that combines RSI and volume divergence can offer insights into potential trend reversals. In this session, the RSI dipped below 30 with no immediate volume confirmation, suggesting a potential oversold condition. However, the lack of a bullish reversal candlestick (e.g., bullish engulfing or morning star) indicates the bearish bias is likely to continue. A buy signal might be triggered if the price closes above the 38.2% Fibonacci level at $9.95e-06 with a corresponding increase in volume and RSI above 50. Conversely, a short signal may be justified if the price breaks below $9.68e-06 with rising volume and MACD divergence. This strategy emphasizes the importance of aligning momentum indicators with price action and volume.