With Bitcoin changing the market’s mood today, multiple altcoins have skyrocketed. Some others like Polkadot have noted sustainable hikes too, adding to its already impressive performance.
Polkadot gets moving
Bitcoin registered its highest single-day rally in more than two weeks – 5.2%. This price action pushed BTC to not only close above $44.6k, but also helped it rally further to cross $47k on the charts.
This imbued bullishness among the altcoins and Polkadot was one of its recipients as it saw significant appreciation too. In fact, this has pushed DOT towards its 2-month long resistance of $23.21
However, this isn’t the first time DOT has followed the king coin. DOT has been imitating Bitcoin’s price action for months now, noting ups and downs in the same manner as BTC does.
Alas, the volatility in the case of Polkadot hasn’t been as wild as the king coin since the bigger picture for the altcoin continues to be its parachain auctions. These are currently in their third round (thirteenth auction).
Polkadot volatility | Source: Coinmetrics – AMBCrypto
This is why regardless of the consistency over the last 21 days, investors haven’t cared much to make any major moves on the network.
Even if the spike of November is disregarded, on-chain transactions have observed a decline nevertheless. The average has dropped from over 200k to a little over 100k.
Now, when compared to other networks, this figure is still huge. However, given how well Polkadot was doing when the Parachain auctions first started, the decline certainly is disappointing.
Polkadot daily transactions | Source: Coinmetrics – AMBCrypto
Investors, are you awake?
This has been triggered by the lack of liveliness among investors, something consequently reflected in the transactions conducted throughout the day.
Some 22k to 23k investors have been active on the network over the last week. This is a significant drop down from its earlier numbers.
Polkadot daily active users | Source: Coinmetrics – AMBCrypto
Even so, since both the token and the network are doing well currently, the lack of participation might not be a trigger for a relapse. DOT can continue to rise or at the very least, consolidate around its current position.
The reason a relapse is likely to occur is that the overall volatility is presently at its lowest point in over 16 months (ref. Polkadot Volatility image). This will keep the price swings under control.
With DOT inching so close to $23.21, the altcoin will have the opportunity to flip it into resistance. Such a price action will allow it to recover all of 2022’s losses.
Polkadot Price action | Source: TradingView – AMBCrypto
