Prom/Tether Market Overview: Volatility and Key Support Levels Emerge

Summary
• Price action reveals a 15-minute pullback into key support near 10.50.
• Volume surges highlight bearish pressure amid recent corrections.
• Momentum slows as RSI nears oversold territory.

Prom/Tether (PROMUSDT) opened at $10.796 at 12:00 ET - 1 and peaked at $11.0 before retracing to a low of $10.50. At 12:00 ET today, the pair closed at $10.546 with a total volume of 101,974.09 units and a notional turnover of $1,078,146.77.

Structure & Formations

Price formed a bearish engulfing pattern near the $10.925 high, followed by a consolidation into a descending triangle. A key support level is now forming near $10.50, with a doji appearing at that level, suggesting potential reversal or a pause in the decline. Traders should watch the 10.65–10.70 range for signs of reversal or further breakdown.

Moving Averages

On the 15-minute chart, the 20SMA and 50SMA are in a bearish crossover, reinforcing the downtrend. On the daily chart, the 50DMA has crossed below the 100DMA, indicating bearish momentum in the broader trend. This alignment of averages suggests continuation bias unless a breakout above the 10.75 level occurs.

MACD & RSI

The MACD histogram has been contracting, signaling waning bearish momentum. RSI dipped into oversold territory (~30) in the last 4–5 hours, hinting at a possible bounce. However, without a clear break above 10.65, the RSI is expected to remain in the lower quadrant of the indicator.

Bollinger Bands

Volatility has expanded with the bands widening to approximately $0.17. Price recently retested the lower band at $10.50 and closed near it, suggesting a potential bounce. If it closes above the middle band, a retest of the upper band at $10.75 could be in play.

Volume & Turnover

Volume has spiked during key breakdowns, especially between 00:00 and 02:00 ET, when the price dropped sharply. Notional turnover also surged during the same window, confirming bearish conviction. A divergence appears between price and volume in the last 2 hours, suggesting a possible short-term pause or reversal.

Fibonacci Retracements

A key 61.8% Fibonacci retracement level lies at $10.63, currently acting as resistance. If the price breaks above this level, the next target is the 78.6% level at $10.76. On the 15-minute chart, the 38.2% retrace at $10.57 is offering temporary support.

Backtest Hypothesis

To refine a strategy based on the observed bearish engulfing pattern and Fibonacci levels, a backtest using the MACD and RSI divergence could offer valuable insights. A potential approach involves identifying RSI oversold conditions (below 30) and MACD bottom divergences, then measuring the performance of long entries on confirmation of a close above the 10.63 level. This could be tested from 2022 to 2025, with stop-loss at $10.50 and a target of $10.76.