Following a period of bearish activity, Polkadot [DOT] has shown signs of resurgence as it broke out of a descending wedge pattern on its daily price chart.
Currently, DOT is trading at $7.42, marking a 6.25% increase over the last 24 hours. This breakout has instilled optimism in DOT traders who are now closely monitoring crucial resistance levels. The question now arises – Can Polkadot sustain its upward momentum and target $12?
Indications of Bullish Continuation
The price movements of Polkadot suggest a clear pathway for further uptrends post the breakout from the falling wedge pattern on the daily chart, indicating a potential 51% upside. Additionally, other bullish patterns like a pennant flag and a cup and handle formation have emerged, supporting a potential move towards $9.23 upon a decisive breach of the $7.89 resistance level. These patterns underscore the increasing dominance of buyers, positioning DOT for a notable surge in value.
However, a failure to maintain levels above $7.89 could lead to consolidation, delaying further upward movement. Hence, sustaining this level is pivotal for preserving its bullish trajectory.
Binance Funding Rate Reflects Growing Confidence
As of the latest data, the Binance funding rate for DOT stands at 0.01%, indicating a positive sentiment among leveraged traders. This also suggests a rise in demand for long positions, supporting the ongoing rally of the altcoin.
Nevertheless, sharp spikes in funding rates might indicate excessive leverage within the market, potentially triggering a correction. Thus, maintaining stable funding rates is crucial to prevent overextension. Furthermore, stable funding conditions are likely to attract more traders towards long positions, further propelling the upward trend.
Increasing Trader Interest on Social Platforms
The social volume related to DOT has been progressively rising, with recent data indicating 84 mentions in the past day. Although slightly lower compared to previous spikes, this consistent growth signifies a positive trend in community engagement.
This surge in social interest suggests that a greater number of traders are discussing DOT, often correlating with heightened trading activity. Strong social engagement could provide the necessary buying pressure to catapult DOT above $9.23.
Exercise Caution Amid Market Sentiment
The long/short ratio for DOT currently showcases 49.13% long positions and 50.87% short positions, reflecting a somewhat cautious sentiment prevailing in the market. While slightly leaning towards bearish sentiments, the balanced ratio indicates a lack of dominance from either side.
A noticeable shift towards more long positions could signal renewed confidence in the ongoing rally. Therefore, a substantial inclination towards long positions might be essential for DOT to sustain its bullish breakout.
Is $12 Attainable for Polkadot?
Considering Polkadot’s breakout supported by bullish technical patterns and favorable market dynamics, a surge towards $12 seems increasingly plausible.
With strong price momentum, escalating social interest, and optimistic funding rates, DOT appears set for further appreciation. Thus, maintaining levels above $7.89 and breaching the $9.23 mark could pave the way for DOT to approach $12 in the near future.