This Needs to Happen for DOT to Eventually Break Above $8 (Polkadot Price Analysis)
Binance
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The key $7.5 resistance zone recently maintained polkadot‘s bullish momentum, resulting in a 12% decline.
However, DOT’s price action indicates that the medium-term consolidation phase will continue.
Technical analysis
By Shayan
Daily Chart
A detailed examination of Polkadot’s daily chart reveals vague sentiment; The price is showing a prolonged sideways movement, lacking clear momentum, in the range bounded by the $7.5 resistance and $6.2 support.
Consolidation at this stage shows that there is a balance between buyers and sellers, and the RSI indicator hovering around 50 confirms this.
Recently, the price rejected near the critical $7.5 resistance level and the important 100-day moving average, leading to a notable decline.
But in a broader context, the price is likely to continue consolidating in the decisive range marked by the $7.5 resistance and $6.2 support. A clear breakout from this range is mandatory to determine the direction of a sustainable trend.
Source: TradingView
4-Hour Chart
On the 4-hour chart, Polkadot price failed to regain the critical resistance zone defined by the 0.5 ($7.4) and 0.618 ($7.8) Fibonacci levels, which led to a notable rejection and continued downward trend towards the lower boundary of the ascending wedge. started a retreat. 7 dollars.
After reaching this slight decisive support threshold, the price encountered buying pressure and demand, resulting in a minor reversal. However, momentum is not enough for the reversal to be valid.
As the price approaches the tight and narrow range marked by the lower boundary of the wedge and the Fibonacci level of 0.5 ($7.1), the upcoming price action will determine the next move. A breakout looks imminent in either direction.
Source: TradingView
Sentiment Analysis
By Shayan
Analyzing Polkadot’s price fluctuations as well as futures market metrics can provide valuable information to investors. This chart shows Polkadot Funding Rates and Open Interest metrics, which measure whether buyers or sellers are executing futures orders more aggressively, thus assessing futures market sentiment.
As the chart shows, both metrics fluctuated near their lowest values during the last long-term consolidation phase, indicating a period of low activity and uncertainty. However, recently both Funding Rates and Open Interest metrics have started an increase, indicating increased activity in the futures market.
The increase in these metrics reflects that long orders may become more aggressive and market sentiment is shifting towards a more bullish outlook. If this behavior continues, it could lead to a bullish trend and ultimately pull Polkadot out of its long and tiring sideways range.
Source: TradingView
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