- Despite its bearish market stance, Polkadot’s [DOT] shows indications of a possible bullish recovery.
- Driven by Bitcoin’s recent rally and promising metrics, DOT’s price could be gearing up for a significant rebound.
Decoding the DOT Dynamics
Bitcoin’s impressive ascent to $30k on August 9 kindled a fresh wave of bullish optimism across the cryptocurrency landscape. In this uplifted climate, despite Polkadot’s [DOT] prevailing bearish tilt, the probability of a bullish turnaround has become more pronounced.
Responding to these evolving market conditions, DOT has managed to register an encouraging 4.5% uptick over the last 48 hours, positioning its current price at an appreciable $5.05. Given DOT’s ability to maintain its stance above the critical $5 mark coupled with Bitcoin’s sustained bullish trajectory, the Polkadot network’s native token might just be on the brink of a substantial price rejuvenation.
Analyzing Key Indicators
Post facing price rejections on both July 14 and July 21 within the bearish order zone of $5.6-$5.85, the support threshold of $5.23 was overrun by bears. Nevertheless, the sellers’ momentum dwindled at this juncture, with the buyers effectively stabilizing the price around the $5 benchmark.
Enhancing DOT buyers’ prospects is the overall market’s price revitalization. The Chaikin Money Flow (CMF), a crucial indicator, underscores this growing buyer sentiment. Demonstrating a robust shift away from the neutral territory, the CMF touched a commendable +0.20, signaling swift capital ingress.
In a parallel vein, the Relative Strength Index (RSI) furnishes insights into a rebounding buying thrust, inching towards the balanced 50 mark from previous doldrums in the oversold territory.
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Armed with these metrics, the bulls are poised to contest the bears at the pivotal $5.23 price bracket. A successful conversion of this resistance into support could potentially pave the way for gains spanning from $5.50 to even $6. Yet, any resistance encountered here might push DOT’s price downwards, possibly to $4.5, particularly if Bitcoin’s rally wavers.
Another beacon of hope for the buyers is DOT’s positive funding rate over the preceding 24 hours, as reported by Coinglass. This reversal in funding rate might just be the catalyst required to galvanize buyers.
On the exchange front, the long/short ratio underscores a shift in the tide favoring the buyers, albeit marginally. The long positions have a slight edge, holding a 50.1% majority on the shorter four-hour window. This subtle dominance suggests the potential for an impending rally, which might extend gains in extended time frames.
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