Anticipated Surge: Polkadot Could Rally to $6.20 Following Strong Support
In the recent period, Polkadot [DOT] has experienced a bearish trend, declining by 2.73%. Within the past 24 hours, it saw a further drop of 3.74%.
While a slight decrease in price is still a possibility, there are indications pointing towards a potential uptrend.
Experts have examined the factors contributing to this expected movement and have shared insights on what investors should monitor.
DOT Shows Signs of a Major Rally as Crucial Support Levels Approach
DOT is edging closer to two important support levels, setting the stage for a significant potential rally. The primary support rests at $4.218, with the second being the diagonal support line within the ascending channel.
A positive response from the initial support level (indicated in black) could trigger a minor upward movement. If DOT rebounds from the base of the bullish formation, its initial target is likely $4.93.
Breaking above this resistance might result in a further surge of 27.39%, driving DOT towards $6.285.
In case the support level of the pattern is breached, a temporary halt in DOT’s upward journey might be observed.
Market Sentiment Points Towards a Positive Shift
The Relative Strength Index (RSI) has notably decreased to 49.99, positioning it close to the neutral zone.
This development hints at a potential further decline in DOT’s value, potentially dropping below the $4.218 support level on its way to the ascending channel’s supportive trend line.
RSI gauges price changes’ speed and size to assess an asset’s momentum, signaling in this scenario the likelihood of additional short-term declines for DOT.
Conversely, the Money Flow Index (MFI), which monitors liquidity inflows and outflows, displays a healthy influx for DOT. Continuation of this trend could indicate an upcoming price surge.
Bullish Market Sentiment Prevails in Overall Market Activity
An evaluation of market movements using Exchange Netflow data from Coinglass revealed ongoing bullish sentiment.
Throughout the previous week, the Exchange Netflow has remained negative, with approximately $3.04 million in DOT withdrawn from exchanges.
This trend suggests that more traders are holding onto their assets for secure storage rather than selling, which typically exerts downward pressure on prices.