Market Overview for Sei/Yen (SEIJPY): Bearish Momentum with Oversold RSI

• Price declined 4.4% over 24 hours, closing at 46.67 from an open of 48.04
• Volatility expanded significantly after a consolidation phase in early trading
• RSI reached oversold territory, hinting at potential bounce
• Volume surged during the decline, confirming bearish momentum
• Key support now at 46.53, with a possible test of 46.4 in the short term

The Sei/Yen (SEIJPY) pair opened at 48.04 at 12:00 ET-1 and closed at 46.67 at 12:00 ET, with a high of 48.11 and a low of 46.53. The 24-hour period saw total volume of 502,645 and a turnover of $23,828,340. A sharp sell-off emerged after a morning consolidation, with price falling into a bearish trend marked by strong volume and a bearish engulfing pattern on the 15-minute chart. Key support levels formed at 46.53 and 46.4, with a 50-period moving average at 47.23 indicating short-term bearish bias.

The price has now broken below the 50-period moving average and sits well below both the 20- and 50-period lines, which remain bearish. The 20-period MA is at 47.31, and the 50-period MA is at 47.23, suggesting downward momentum is likely to persist. On the daily chart, the price is comfortably below the 50, 100, and 200-period moving averages, reinforcing the bearish sentiment.

MACD has turned negative and shows bearish divergence with price during the selloff. RSI has dropped into oversold territory at 29, suggesting potential for a short-term bounce but not necessarily a reversal. Bollinger Bands show expansion, indicating increased volatility, with the price currently sitting near the lower band at 46.53. The 61.8% Fibonacci retracement of the recent downward leg sits at 46.78, offering a potential short-term resistance if a bounce occurs.

Volume surged significantly during the decline, with the largest 15-minute candle having a volume of 12,975. Notable volume spikes occurred around 23:30–23:45 ET and 05:00–06:00 ET, confirming the bearish momentum. However, the price has not yet shown a clear reversal pattern, and a test of key support levels is expected.

The market may consolidate near 46.53 in the next 24 hours before deciding the next direction. A break below 46.4 could signal further downside, while a bounce above 46.78 may indicate a short-term reversal. Investors should remain cautious as volatility remains high and momentum is still bearish.

Backtest Hypothesis
The backtesting strategy suggests a mean-reversion approach triggered when RSI crosses below 30 and price touches the lower Bollinger Band. A long entry is initiated with a stop-loss set 1% below the entry and a take-profit at the 50-period moving average. This strategy aligns with the recent RSI oversold condition and the price hitting the lower Bollinger Band, making it a relevant hypothesis to evaluate for potential bounce opportunities in the next 24 hours.