Cryptoclump: Polkadot (DOT) in an endless decline?

Although the cryptocurrency market is not in the best possible condition, Polkadot’s ecosystem continues to grow. The original asset, DOT, has seen its price fluctuate for several months. Is this the beginning of a long journey to hell? Or rather, will we see a bullish recovery? In this new technical analysis, we will have the opportunity to study the key levels to consider the plausible scenarios for DOT.

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DOT in trouble with bitcoin?

Polkadot's DOT cryptocurrency price against Bitcoin cryptocurrency on a daily basis
DOT price against bitcoin (1D)

When we analyze the asset against the king of cryptocurrencies, we can see that it is underperforming. The inclined resistance materializes this trend with decreasing heights for several months. After losing its pivot zone at 5000/5100 satoshis, it served as resistance for DOT. All the more so, quite recently, another level was lost on 4200 satoshis, which once again confirms the trend that the asset is following towards bitcoin.

As it is currently “in the void”, it is likely to re-enter 3535 satoshis, a level that has not been found since the double bottom in the summer of 2021. Should this level ever fall, it is important to expect continued underperformance of DOT against bitcoin.

Thus, against bitcoin, the goal is simple: Resume the first level at 4200 satoshis and then, at best, a revival of the pivot zone. This would make it possible to have a more powerful DOT in case bitcoin should regain strength against the dollar. Of course, nothing is certain at the moment as the DOT has not managed to resume any major level against the king of cryptocurrencies.

A simple weekly interval against the dollar?

Polkadot DOT cryptocurrency price against dollar on a weekly basis
DOT price against dollar (1W)

Now we can make an interesting observation for DOT on a weekly basis. It has been in an area since early February. It fluctuates between an upper limit of $ 23.19 and a lower limit of $ 14.05. Since we are currently on the lower band, we can theoretically expect a recovery from the asset. We will have the opportunity to elaborate on this point in our last part, which will deal with the daily scale.

In case the DOT should break the lower limit downwards, the first bearish target in the gray zone is below $ 10.15 / 10.75 where the price had returned during the summer of 2021. It is therefore an important level where buyers could emerge . In this context, the trend will be clearly bearish, which may cause the price to seek even lower levels. This is a hypothesis that can not be ruled out.

Conversely, if we want to have an upward trend on a weekly scale, it will be necessary to break the upper limit upwards, which is located at $ 23.19, a technical zone that was previously a support from August 2021 to January 2022 But why should we probably have an uptrend? This is simple and is based on a single element: the trend principle, which is defined by rising peaks and troughs.

What is the DOT situation on a daily basis?

Daily price of Polkadot's DOT cryptocurrency against the dollar
DOT price against dollar (1D)

On a daily scale, we can see the recent loss of a support zone to $ 16, dated January 21st. The recent eruption has taken the price back to the lower band that we saw earlier in the analysis. In case we go down, we might consider returning to $ 13 before considering returning to $ 10.75. However, this is by no means a major area, it is important to know.

On the contrary, if we play rebound at this lower limit, it will be necessary to resume the recently lost support as soon as possible. This could be seen as a reintegration with purchasing power. In this case, how is one to imagine the sequence of events?

If we want a return on the upper limit of the range, the DOT must break up the $ 19.68, this will allow a potential reversal within the range to operate. As the trend is currently down, an eruption of this level will allow for a whole new high. Followed by a low that is higher than what appears to be happening at the moment, so we want confirmation of a trend reversal. Of course, nothing is played. It will then be necessary to monitor the price action in the coming days.

Here we are at the end of this analysis of DOT, which is currently located at the lower limit of a weekly interval. Are we on the verge of a bearish breakout that will bring the DOT to levels not seen since last year? This is a very good question, which we will be able to see a little clearer tonight. Kl. At 20:00, there will be a FOMC, which will make decisions and provide details about the interest rate increase. We are therefore facing a crucial day that can give direction to the financial markets over the next few years. So be vigilant and above all, do not take risky positions in a risky environment where volatility is likely to be high.

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