The Bearish Trend of Polkadot (DOT) Price
The price of Polkadot (DOT) has been in a bearish trend for the majority of this year, experiencing a decrease from the $4.30 horizontal support area in September. Now, this area is expected to act as resistance, and the next closest support area can be identified using Fib levels.
Polkadot Falls Below Descending Resistance Trendline
Since reaching a new yearly high of $7.90 in February, the DOT price has been falling and has remained below a descending resistance trendline for 221 days. During this time, DOT has fallen by 50%. A rejection occurred on July 21, accelerating the rate of decrease.
Breakdown from Horizontal Support Area
In September, the Polkadot price broke down from the crucial $4.30 horizontal support area that had provided support since the beginning of the year. This area is now expected to act as resistance if the price bounces.
Daily RSI Leaning Bearish
The daily RSI indicator is leaning bearish, indicating that the market may be oversold. Traders can use this momentum indicator to determine whether to accumulate or sell an asset. With the RSI still below 50, despite moving upwards, it suggests a bearish trend.
Next Support Levels and Fibonacci Retracement Tool
The $4.30 area is the final horizontal support level before the all-time low of $2.69. To determine the next closest support levels, it is necessary to use a Fibonacci retracement tool. These levels can help identify potential future upward movements.
Weekly RSI Confirms Bearish Trend
The weekly RSI is also below 50 and falling, further confirming the bearish trend. This adds to the bearish DOT price prediction.
Potential Breakout Scenario
However, if there is a breakout above the $4.30 area and the descending resistance trendline, it would invalidate the bearish outlook. In that case, Polkadot could potentially increase by 40% to the next resistance level at $5.70.
Hot Take: Bearish Trend Continues for Polkadot (DOT) Price
The Polkadot (DOT) price has been experiencing a bearish trend, with a breakdown from the $4.30 support area and a continuous decrease under a descending resistance trendline. The RSI indicators on both daily and weekly timeframes suggest a bearish outlook. However, if there is a breakout above the resistance levels, the trend could reverse. Traders should closely monitor these key levels to determine potential entry or exit points.
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