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These Are the Next Support Levels for DOT if Bulls Fail to Overcome $7.5: Polkadot Price Analysis

Polkadot has struggled to reclaim the critical $7.5 resistance region and the 100-day moving average at $7.4.

Yet, the current bullish momentum appears insufficient, suggesting a possible short-term consolidation near this pivotal level.

Technical Analysis

By Shayan

The Daily Chart

A detailed examination of Polkadot’s daily chart reveals that after a resurgence of demand near the $6.5 support level, the asset experienced a bullish surge. This movement brought DOT to a critical resistance zone defined by the 100-day moving average and the static level at $7.5. Breaking out from this key price range could attract more demand, leading to a sustained bullish movement.

However, the current price action around the $7.5 mark indicates fading bullish momentum. Buyers are facing significant challenges pushing the price beyond this resistance. Therefore, a sideways consolidation or slight rejections is likely before the next decisive move. In this scenario, the $6.4 level will be the primary support in the mid-term.

The 4-Hour Chart

On the 4-hour chart, the bullish momentum decrease is evident upon reaching a significant resistance zone, with the price failing to breach its prior swing high. This critical resistance range is bounded by the 0.5 ($7.415) and the 0.618 ($7.821) Fibonacci levels. However, forming a potential double-top pattern near this resistance suggests a possible short-term rejection.

Should buyers overcome the substantial resistance at $7.8, the next target would be the upper boundary of the wedge in the mid-term. Conversely, a rejection at this level could lead to another downward move, targeting the wedge’s lower boundary. A decisive breakout from this wedge pattern will be necessary to determine Polkadot’s future direction.

Sentiment Analysis

By Shayan

Polkadot’s price has shown signs of waning bullish momentum, failing to breach the previous swing high of $7.7. Analyzing the futures market sentiment is crucial in determining whether this uptrend will continue, as futures market activity significantly influences price movements.

This chart presents the funding rate and open interest metrics alongside Polkadot’s daily price movements. Despite the recent bullish move, open interest and funding rates have remained near their lowest levels, showing no significant increase. This indicates a lack of strong bullish momentum and raises the possibility of a consolidation correction.

This suggests that market participants are not increasing their long positions significantly, indicating a lack of confidence in continuing the uptrend. Given the dormant funding rates and low open interest, the likelihood of a consolidation correction increases.

This means that Polkadot may enter a period of sideways movement or slight declines before determining its next direction. Nevertheless, if the open interest and funding rates increase, this would signal renewed bullish momentum. An uptick in these metrics would indicate that traders are gaining confidence and entering more aggressive long positions, potentially solidifying the uptrend.

The post These Are the Next Support Levels for DOT if Bulls Fail to Overcome $7.5: Polkadot Price Analysis appeared first on CryptoPotato.

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