DOT: As selling stagnates, are bears abound?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- DOT breached a crucial $4.32 short-term support.
- Selling stagnated, suggesting a likely range over the weekend.
According to TradingView, Polkadot [DOT] closed August in red, suffering over 16% loss on monthly performance. Although July posted mixed results, with an overall 1% loss, Q3 doesn’t look impressive for DOT bulls.
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On the other hand, Bitcoin [BTC] retested the $28k level on 29 August but reversed the gains and struggled to hold on to $26k as of press time. The losses meant sellers could gain more leverage into the weekend (2-3 September).
DOT cracks the $4.32 short-term support
The mid-August price dump was temporarily stopped at $4.32 short-term support. The support has been steady since June and had confluence with the weekly bullish order block (OB) of $4.22 – $4.59 (cyan).
For perspective, the weekly bullish OB prevented the June price dump, and a similar trend could bolster bulls. So, sellers could watch for a break below the cyan area before extending gains to $4.0 support.
On the other hand, BTC’s reversal to $26k hit a range-low, and a narrow price range over the weekend could be likely. If so, DOT could consolidate losses below $4.32 support over the weekend.
On the upside, the dynamic resistance level, 50-EMA (Exponential Moving Average), and the H4 bullish OB near $4.6 could be key targets if bulls regain short-term market control.
The RSI retreated to the oversold zone while CMF headed southwards below zero, reinforcing extreme short-term bearish bias on the spot market.
Sellers controlled eased
The CVD (Cumulative Volume Delta) tanked from 30 August but went sideways at the press time. It shows sellers had absolute market control, but buyers countered the influence afterward.
How much are 1,10,100 DOTs worth today?
The flat movement calls for caution, indicating a lack of leverage for buyers and sellers.
Open Interest rates surged from 31 August and could be inferred as sellers’ opened contracts to cover short positions. However, it wavered at press time, reinforcing the neutral thesis over the weekend.