Polkadot’s Value Falls Below $10: Traders Keeping an Eye on $7.09 Support Level
Polkadot [DOT] experienced a significant surge of 185% from its low of $3.7 recorded on the 4th of November. However, a retracement of some of these gains took place, raising the possibility of a further decline in price.
Starting from the second half of March, Polkadot had been following a downward trend. Despite this, as November commenced, the bulls managed to leverage the positive momentum of Bitcoin [BTC] to initiate a recovery.
Below are the key support levels that DOT traders should monitor:
DOT surpasses the $10 threshold
The bullish momentum seen early in November propelled DOT’s prices to $5.7. Following a pullback to $4.75, along with a period of consolidation under the $6 mark, the bulls regrouped in anticipation of the next rally.
Between the 22nd and 24th of November, DOT experienced a significant surge of 77%.
Although there has been a retracement of a considerable portion of this move in recent days, the price was sitting at $7.87 at the time of writing. The strong uptrend in the A/D indicator indicated a high demand for the token.
Moreover, the Money Flow Index did not signal any bearish divergence.
Nevertheless, with Bitcoin approaching the $90k support area, there is a possibility that altcoins will face some setbacks. This could potentially drive Polkadot towards the Fibonacci retracement levels marked at $7.09 and $6.285.
Such a dip could present a valuable buying opportunity.
Decline in Spot CVD Suggests Weakened Demand
On Sunday, the 24th of November, the Open Interest (OI) reached a peak of $399.8 million. Concurrently, the spot CVD showed a strong uptrend with significant inflows, but this trajectory started to shift the following day.
Both the OI and spot CVD began to decline, indicating reduced demand in both the spot and futures markets.
The drop in spot prices was particularly sharp, reflecting intense selling pressure in the shorter timeframes. While the funding rate remained positive, it is likely that further losses may occur in the coming days.
Disclaimer: The views expressed do not constitute financial, investment, trading, or any other form of advice and are solely the writer’s personal opinion