- A significant breakout led to a spike, followed by a correction, identifying support at $6,861.
- The RSI has been hovering around 50, indicating a balance between buying and selling forces.
Polka dot [DOT] has shown dynamic price movements, piquing traders’ interest with key resistance, support levels and on-chain metrics.
DOT has shown notable price movements, with key resistance levels at $8,181, $9,573, and $10,490.
Source: TradingView
A significant breakout led to a spike, followed by a correction, identifying support at $6,861.
Volume spikes during the uptrend indicated strong buying interest, while consolidation around $7,866 suggested a possible recovery.
Assessing Polkadot’s momentum using RSI
Traditionally, an RSI above 70 indicates overbought conditions, indicating a potential price reversal or pullback, while an RSI below 30 indicates oversold conditions, implying a possible price increase.
Source: CoinGlass
In Polkadot’s recent chart, the RSI approached overbought territory during the uptrend, indicating strong bullish momentum. When the price peaked and corrected, the RSI dropped to a neutral level, reflecting waning buying pressure.
At the time of writing, the RSI was hovering around 50, indicating a balance between buying and selling forces. If the RSI moves back above 70, it could indicate renewed bullish momentum, potentially leading to a retest of resistance levels.
Conversely, a drop below 30 could indicate increased selling pressure and a possible decline towards support levels.
DOT’s MVRV Ratio: Is It Overvalued or Undervalued?
An MVRV ratio above one indicated that the market value is higher than the realized value, indicating potential overvaluation, while a ratio below one implies undervaluation.
Source: TradingView
For Polkadot, the MVRV ratio rose above 1 during the recent uptrend, indicating that the market value was higher than the realized value, which is typical of bullish phases.
As the price corrected, the MVRV ratio fell towards 1, reflecting a move towards a more neutral valuation. Currently, the MVRV ratio is slightly above 1, which indicates that Polkadot is slightly overvalued.
Read Polkadot [DOT] Price forecast 2024-2025
A significant increase in the MVRV ratio could indicate increased bullish sentiment and potential price appreciation, while a drop below 1 could indicate bearish trends and further price corrections.
Polkadot’s recent price movements have been marked by significant fluctuations, with key resistance and support levels playing a crucial role.
The RSI and MVRV ratios provide valuable insights into the asset’s momentum and valuation, respectively.
