Polkadot Price Correction: What You Need to Know
Polkadotโs recent price decline of 33% was triggered by the Iran-Israel conflict news on April 14th. Despite this significant drop, the price of Polkadot found support at the crucial 200-day moving average, indicating a potential period of consolidation and correction. Hereโs what you need to know about Polkadotโs price technical analysis and sentiment analysis:
Polkadot Price Technical Analysis
The Daily Chart
- A review of the daily chart reveals a substantial downtrend, with Polkadot experiencing a 32% decline following the news of Iranโs invasion of Israel.
- This plunge breached critical support levels, triggering a long-squeeze event in the perpetual markets and resulting in the liquidation of numerous long positions.
- The price ultimately found support at the 200-day moving average and exhibited a slight rebound, suggesting a potential consolidation phase.
- The most likely scenario is for Polkadot to consolidate within the price range of the 200-day moving average support to the resistance at $9 in the medium term.
The 4-Hour Chart
- Polkadotโs price analysis on the 4-hour timeframe indicates a decline after failing to breach the $9 resistance region, leading to heightened selling pressure.
- The breach of the critical $8 support zone drove the price towards the $6 support level, where a minor bullish reversal was observed.
- Expectations are for Polkadot to continue its corrective movement, with the next target between the Fibonacci levels of 0.5 ($7.4) and 0.618 ($7.8).
Sentiment Analysis
On April 14th, Polkadot experienced a significant downturn due to the escalating conflict between Iran and Israel. This geopolitical tension impacted traders, leading to concerns about increased volatility and price declines.
- The surge in volatility resulted in the forced liquidation of long positions worth approximately US$14 million in perpetual futures contracts.
- This event marked the most significant long liquidation since May 2022, indicating the marketโs vulnerability to large-volume trades influenced by major news events.
- Despite the recent challenges, the futures market seems to have calmed down, potentially paving the way for a bullish rebound towards higher price levels.
Hot Take: Stay Informed and Cautious
As a crypto investor, staying informed about market events and their impact on prices is crucial. While Polkadotโs recent price correction may have been triggered by external factors, itโs essential to approach trading with caution and awareness of market sentiment. Keep track of developments in the crypto space and make informed decisions to navigate market fluctuations effectively.
Owen Patter is a distinguished crypto analyst, accomplished researcher, and skilled editor, leaving a notable imprint on the cryptocurrency landscape. As a proficient crypto analyst and researcher, Owen delves into the intricate realms of digital assets, offering insights that resonate with a diverse audience. His analytical acuity is harmoniously paired with adept editorial skills, allowing him to transform complex crypto information into easily comprehensible content.