Polkadot’s price analysis continues to indicate a bearish outlook as the market goes through a notable decline. Over the past 24 hours, the asset’s price underwent a slight decline, demonstrating a sideways move under the influence of bearish sentiment.
On a weekly time frame, there was limited movement in the price of DOT. In terms of technical indicators, DOT has shown bearish strength, with low buying pressure. Both demand and accumulation levels are down based on the daily chart.
Given the indecisiveness on Bitcoin’s chart, many altcoins, including DOT, have either been restrained below immediate resistance levels or have entered a consolidation phase. It is crucial for DOT to maintain a price level above its immediate support to avoid the possibility of another substantial decline in upcoming trading sessions.
If selling pressure builds, there is a risk that the altcoin will break below its crucial support level. Polkadot’s declining market cap indicates that sellers are still exercising control over the asset.
Polkadot Price Analysis: One Day Chart
At the time of writing, DOT is trading at $5.29 while Polkadot is hovering near its critical $5.15 support level. If the price drops below this level, it could drop further to $5. On the upside, a significant level of resistance is observed at $5.40.
If DOT bulls manage to surpass this resistance, it could potentially trigger a rally to $5.71, indicating a 6% appreciation.
Further progress could then push the price into the $6 range. In particular, DOT’s trading volume in the last session was relatively low. This suggested that purchasing power was weaker compared to selling pressure.
Technical analysis
During the months of April and May, demand for DOT remained relatively weak. Analysis shows that the Relative Strength Index (RSI) remained below 40, indicating that selling pressure was greater than buying pressure in the market.
In addition, DOT remained below the 20-Simple Moving Average (SMA), further confirming the dominance of sellers in driving price momentum.
However, if DOT manages to surpass the $5.30 mark, it has the potential to climb above the 20-SMA line. This could potentially lure buyers back into the market and shift overall sentiment in a more positive direction.
As demand for DOT eased, the altcoin showed decreasing buy signals on the one-day chart. The Moving Average Convergence Divergence (MACD), which represents price momentum and trend reversal, showed descending green histograms, indicating a weak buy signal for DOT.
In addition, the Bollinger Bands, which illustrate price volatility and fluctuations, showed narrowing, indicating range-bound movement.
The upcoming trading sessions are important for DOT as they will determine whether the price breaks above or below the crucial support line.
Featured image from UnSplash, charts from TradingView.com
