Polkadot (DOT) Price:A Recovery Or Short-Term Relief?

As a researcher with experience in analyzing cryptocurrency markets, I believe that Polkadot (DOT) has found strong support at its previous low of $6.40, indicating that the price may have bottomed out. The double bottom pattern formed on the 30th of April further supports this notion. However, it is essential to note that DOT’s ability to maintain a position above the 200-day Simple Moving Average (SMA) will be crucial in determining the potential for an upward price movement.

The price trend of Polkadot (DOT) has been declining for some period. Yet, there’s been robust and persistent buying interest around the $6.40 mark, hinting that a potential price floor may have been reached.

On Wednesdays and Thursdays, there was a notable rise in DOT‘s price, pushing it above both the 20-day simple moving average (SMA) and the 200-day SMA.

Polkadot (DOT) Rebounds From Support Level 

As a crypto investor, I’ve witnessed a significant decline in DOT since it reached its peak price of $11.55 on March 14th. In just a few days, the price dropped by more than 40% and fell below the 20-day Simple Moving Average (SMA) at $8.77 by March 19th. A brief recovery brought DOT up to $9.14 but was short-lived due to the resistance of the 20-day SMA, causing the price to drop again to $8.43 on April 3rd. After another attempted recovery, the price of DOT plummeted by 13.48% on April 12th and an additional 11.72% on April 13th. This downward trend has pushed the price below the 200-day SMA, reaching a new low at $6.40.

In simpler terms, the price of DOT experienced a significant boost around this period due to robust backing, causing it to surge back above its 200-day Simple Moving Average (SMA) on April 22nd, reaching a high of $7.47. However, the 20-day SMA served as an obstacle at that time, leading DOT’s price to fall back below the 200-day SMA and drop to $6.73 by Sunday. The current week witnessed successive declines for DOT, with a 2.23% decrease on Monday and a 2.43% decline on Tuesday, resulting in a session closing price of $6.42. It’s essential to note that this level of support has proven to be quite resilient, as evidenced by DOT rebounding on Wednesday with a 7.48% increase to $6.80, challenging the resistance at $7. Buyers continued their efforts to push the price higher on Thursday, resulting in an increase of 5.65%, moving above both the 20-day SMA and the 200-day SMA to close the session at $7.29.

As a market analyst, I observe that the price of DOT hovers around $7.17 at present, slightly above its 200-day Simple Moving Average (SMA). The battle between buyers aiming for gains and sellers looking to secure profits is intensifying in this session.

Does Double Bottom Pattern Indicate A Revival 

Examining the Polkadot (DOT) price history, some notable trends emerge. The DOT chart reveals a descending triangle formation between March 15th and April 11th, suggesting that sellers have been in command. However, on April 30th, DOT displayed a double bottom pattern, hinting at a potential price reversal. At present, DOT is trading within the range of $7.10 to $7.20, with the 200-day Simple Moving Average (SMA) sitting at $7.19. Should DOT fail to maintain an upward trend above its 200-day SMA, it might dip down towards $7, where the 20-day SMA could potentially offer support. If sellers manage to push prices below this level, DOT may retrace back to its previous support of $6.40.

As an analyst, I would interpret the price action of DOT in the following way: The upward trend in DOT’s price hinges on its capacity to keep rising above the 200-day Simple Moving Average (SMA). Should this be achieved, DOT may challenge the $8 mark, at which point the 50-day SMA could emerge as a significant resistance level.

What The Indicators Are Saying 

As an analyst, I observe that the MACD indicator presents a bullish signal for me, suggesting a positive market trend and potentially paving the way for a more extended price surge. Meanwhile, the RSI reading indicates that DOT is currently in the neutral zone, implying there’s still room for the price to rise further.

Lately, the decrease in DOT‘s price has resulted in several long positions being closed out, causing a noticeable dip in OI-Weighted Funding Rates. This decline in funding rates, coupled with DOT’s current price stabilization, may signal that the bottom of its value has been reached. Consequently, there is a possibility that the worth of DOT could rise.

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2024-05-04 11:46