Market Overview for Yield Guild Games/Tether (YGGUSDT) as of 2025-10-04

• YGGUSDT traded lower by 9.3% over the last 24 hours, with a bearish close near the session low.
• Price formed multiple bearish engulfing patterns after 20:00 ET, signaling continued downward pressure.
• Volatility expanded significantly during the overnight session, with a sharp drop to 0.1660 by 15:30 ET.
• RSI entered oversold territory, suggesting potential for a short-term bounce, though bearish momentum remains intact.
• Notional turnover surged during the selloff, indicating strong conviction in the downward move.

Yield Guild Games/Tether (YGGUSDT) opened at 0.1810 on 2025-10-03 at 12:00 ET, reached a high of 0.1837, and fell to a low of 0.1657 before closing at 0.1701 on 2025-10-04 at 12:00 ET. Total 24-hour volume was 20,122,214.5, and notional turnover was $3,426,494.80.

The 15-minute chart reveals a strong bearish bias, with price breaking key support levels multiple times. A notable bearish engulfing pattern formed at 17:00 ET, followed by a continuation of selling pressure through the overnight session. The 20-period and 50-period moving averages on the 15-minute chart both trended lower, reinforcing the downtrend. Bollinger Bands widened significantly during the selloff, indicating increased volatility. Price traded near the lower band by 15:30 ET, which suggests exhaustion of the downward move may be near, though not confirmed yet.

RSI dropped below 30 after 05:00 ET, entering oversold territory, which may suggest a short-term rebound. However, the MACD histogram remains bearish with negative divergence. Notably, the 50-period EMA on the daily chart is above the 200-period SMA, but price remains below both, indicating a potential for a test of the 200 SMA as support. Fibonacci retracements show that the current price is near the 61.8% level of the most recent 15-minute swing from 0.1837 to 0.1657. This could act as a key support or trigger further selling.

Backtest Hypothesis

The backtesting strategy in question involves entering short positions when a bearish engulfing candle forms on the 15-minute chart, RSI is below 40, and volume is above the 20-period average. Stops are placed at the high of the engulfing candle, and targets are set at the next Fibonacci level or the previous support level. Given the recent price action, this strategy would have triggered a short signal around 17:00 ET. The setup was confirmed with RSI below 30 and strong volume. If applied to this period, the strategy would have captured most of the selloff and may have exited near the 61.8% Fibonacci level. However, caution is advised as entering near the 61.8% level increases the risk of a false signal.