Wormhole/Tether (WUSDT) Market Overview: Bearish Momentum and Oversold RSI Signal Caution

• WUSDT dropped 7.5% over 24 hours, forming bearish momentum with RSI near oversold levels.
• Price broke below key support at 0.108–0.109, with volume increasing during the breakdown.
• Volatility spiked in early morning ET, reaching a high of 0.113 before collapsing.
• A long lower shadow at 0.1067 suggests short-term support, though bearish bias remains.

At 12:00 ET on 2025-10-10, WUSDT opened at 0.1077, reached a high of 0.1131, and closed at 0.1016 after hitting a low of 0.1049. The pair traded with a total volume of 88,724,212.8 and notional turnover of $8,986,763.66 over the past 24 hours. The price action shows clear bearish bias, with a breakdown from key support levels and a sharp correction into oversold territory.

Structure & Formations

The 15-minute OHLC data reveals a breakdown below the critical 0.108–0.109 support zone, confirmed by a bearish engulfing pattern at the close of the 19:30–19:45 ET candle. A long lower shadow at 0.1067 and 0.1049 suggests short-term support, though further testing may be required for confirmation. A doji formed near 0.1016 during the 15:45–16:00 ET session, signaling potential exhaustion in the downward move.

Moving Averages

On the 15-minute chart, the price closed below both the 20-EMA (0.1092) and 50-EMA (0.1088), reinforcing bearish momentum. The 50/100/200-day moving averages on the daily chart are not immediately relevant given the recent volatility, but the price has clearly underperformed its 200-day average, suggesting medium-term bearish alignment.

MACD & RSI

The MACD has turned negative, with the histogram showing bearish divergence from the price move. The RSI has entered oversold territory at 28–29, suggesting a potential rebound could be near. However, given the breakdown of key support levels, this oversold reading may not trigger a reversal but instead a continuation of the downtrend.

Bollinger Bands

Volatility expanded during the 18:15–19:30 ET session, with the price reaching the upper band at 0.1131. Since then, the bands have contracted, and the price has been trading near the lower band at 0.1016–0.1019, indicating consolidation in bearish territory. A sustained break above the midline could suggest a short-term bounce, though bearish continuation remains likely.

Volume & Turnover

Volume surged during the breakdown of the 0.108–0.109 support, especially during the 22:15–23:30 ET period. Total notional turnover exceeded $8.9M, with the largest spike occurring at 14:45–15:30 ET when the price collapsed from 0.1068 to 0.1016. The divergence between volume and price movement during the final leg of the decline suggests increased bearish conviction.

Fibonacci Retracements

Applying Fibonacci retracement levels to the recent swing high of 0.1131 and low of 0.1016, key levels at 38.2% (0.1087) and 61.8% (0.1052) have already been tested. The 61.8% level appears to have acted as a resistance-turned-support, but it is currently under pressure. A break below 0.1049 would target the next level at 0.1033, with further support at 0.1019.

Backtest Hypothesis

The backtest strategy leverages a combination of RSI, MACD, and Bollinger Band signals to identify overbought and oversold conditions in high-volatility environments. A potential trade setup occurs when RSI drops below 30, MACD turns negative, and the price closes near the lower Bollinger band. This scenario was observed near 0.1016, suggesting a possible short-term bounce. A long bias could be considered if the price rebounds above the 0.1022–0.1025 zone, with a stop-loss placed below the 0.1015 level. The strategy aims to capture countertrend moves while managing risk with defined stop levels.