The Polkadot (DOT) price trades slightly above a long-term support area at $4.30
The Polkadot (DOT) price is currently trading just above a key support area at $4.30. This support level has been in place for 1,100 days, making it a critical area for determining the future trend’s direction. Whether the price bounces off this support and starts an upward movement or breaks down instead will be crucial in determining the next move for Polkadot.
Main breakdowns of the key points:
- The $4.30 support is crucial for maintaining a bullish trend
- A bounce could lead to the next resistance at $7.70, which is 74% above the current price
- A breakdown could result in a 53% drop to the next support at $2
- The weekly RSI is presenting conflicting signals, not validating the current trend
- The daily timeframe shows a bearish outlook with a descending triangle pattern
The weekly RSI doesn’t validate the current Polkadot trend
The weekly RSI, which is used to identify overbought or oversold scenarios, is currently below 50. However, it has shown bullish divergence, indicating potential upward momentum. With these conflicting signals, the RSI on the weekly timeframe doesn’t provide strong validation for the current Polkadot trend.
The daily timeframe presents a bearish outlook with a descending triangle pattern
Unlike the weekly timeframe, the daily chart shows a bearish outlook for Polkadot. The price has been trading within a descending triangle pattern since the beginning of the year, which is typically a bearish pattern that leads to breakdowns. The daily RSI also supports this bearish sentiment, as it was recently rejected from the 50 line. These factors suggest that a breakdown is likely, with a potential 53% drop to the support at $2.
A breakout from the triangle’s resistance line could change the trend
Despite the bearish prediction, if Polkadot manages to break out from the descending triangle’s resistance line, it would indicate that the trend is still bullish. In that case, an increase to the $7.70 resistance level could be possible.
Hot Take:
The Polkadot price is currently hovering above a long-term support area, but the conflicting signals from the RSI and the descending triangle pattern suggest a potential breakdown. However, if Polkadot manages to break out from the triangle’s resistance line, the trend could turn bullish. Traders should closely monitor these key levels to determine the future direction of Polkadot.
By
By
By
By
By