Polkadot: As demand remains strong, where will DOT head next
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Price rejection at $4.3 resistance kept DOT in a range formation.
- Open Interest and Spot CVD highlighted the strong demand for DOT.
Polkadot [DOT] extended its range formation between the range-low of $3.95 and the range-high of $4.3.
Read Polkadot’s Price Prediction 2023-2024
On 3 October, AMBCrypto explored the possibility of a short-term rally to the $4.3 level before another wave of selling pressure. This price projection was validated with DOT hitting the $4.3 price zone before dropping by 6% to the $4 price level over the past 48 hours.
This price tussle between buyers and sellers along with Bitcoin [BTC] staying above $27.5k could see buyers make another attempt to cross the $4.3 price hurdle.
Support level comes to the rescue of bulls again
Strong capital inflows at the start of October as highlighted by the CMF (Chaikin Money Flow) helped bulls rally toward the $4.3 resistance level. Despite the price rejection at the level that dropped DOT to $4, the CMF still remained above zero, showing the continued capital inflow.
The 12H chart revealed that DOT’s market structure remained bearish with the RSI (Relative Strength Index) moving from the upper level (bullish) to the lower level (bearish). This signaled that buyers needed to reignite the bullish momentum, or else the persistent selling pressure could break the support level.
If bulls are able to break the lower low at the $4.3 price zone, further gains can be achieved at $4.4 to $4.6. On the other hand, a break of the support level by sellers would see DOT head to another year-low between $3.6 to $3.8.
How much are 1, 10, or 100 DOT worth today?
Futures market data showed another bounce could be imminent
Data from Coinalyze showed that the OI (Open Interest) has been on an uptrend since early September, despite the ranging price action. This signaled an interest in a sustained price rebound for DOT.
In addition, the Spot Cumulative Volume Delta (CVD) echoed the strong demand with steady upward movement. This could see a sustained bullish recovery materialize for DOT in the short term.