【$DOT Signal】Oversold Rebound Play: 1H RSI Significantly Oversold, Initial Signs of Main Force Supporting the Market

$DOT After experiencing a waterfall decline, the 1H timeframe formed a long lower shadow near 1.235. Currently, the price is oscillating narrowly around 1.255, typical of a quick rebound and correction after a sharp drop. Although the 4H timeframe remains in a downtrend channel, the 1H RSI has fallen to an extreme oversold level of 26.87, and the latest one-hour buy ratio has risen back to 0.5, indicating short-term exhaustion of bearish momentum. Open interest remains stable with no signs of panic selling. Combined with negative funding rates, there is a short-term rebound opportunity driven by main force support or short covering.

🎯Direction: Long (Long)

🎯Entry/Order: 1.250 - 1.253 (Reason: Near the lower boundary of the current consolidation zone, close to the dense trading area on the 1H timeframe )

🛑Stop Loss: 1.235 (Reason: Breaking below previous low support with a long lower shadow, invalidating the rebound structure )

🚀Target 1: 1.285 (Reason: The starting point of the previous downtrend on the 1H timeframe and EMA20 resistance )

🚀Target 2: 1.310 (Reason: The lower boundary of the previous oscillation platform on the 4H timeframe )

🛡️Trade Management:

- Position Size Recommendation: Light (Reason: The 4H trend remains bearish; this is a contrarian rebound play with higher risk )

- Execution Strategy: After the price reaches 1.285, reduce position by 50% to lock in profits, and move the remaining stop loss up to the entry price of 1.253. If the price fails to break above 1.270 and shows signs of fatigue, consider exiting early.

Deep Logic: Market depth shows unusually heavy buy orders in the 1.236-1.245 range, forming a support barrier, indicating clear main force support. Stable open interest suggests the decline is mainly driven by spot selling or futures liquidation, not active main force dumping. The 1H RSI bullish divergence is brewing; if the price can hold above 1.260, it will confirm short-term rebound momentum. This is a left-side setup based on technical oversold conditions and order book support, with a risk-reward ratio >1.5, making it a worthwhile light position play.

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