Connect with us
Active Currencies 14420
Market Cap $2,654,916,693,311.20
Bitcoin Share 49.90%
24h Market Cap Change $-2.63

Polkadot falls below $4.84, what now?

2min Read

On the back of a Bitcoin rejection at $29.6k, the DOT sellers forced prices to fall as deep as $4.62 on 15 August.

Polkadot falls below $4.84, what now?

Share this article

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

  • Polkadot saw its market structure flipped bearish earlier this month.
  • A price move to $4.6 was brewing, but any further losses would indicate a drop as far south as $3.9 was on the table.

Polkadot [DOT] saw the bears pull off a convincing move downward after the market structure break in early August. Social metrics and development activity were on the rise but this did nothing to dissuade the sellers.


Is your portfolio green? Check the Polkadot Profit Calculator


The price chart showed that there was a downtrend in progress, and a move toward $4.6 was highly likely. Whether the bulls can defend that level of support or not remains to be seen. The latter development could see DOT drop below the $4 mark.

The attempts to defend $5 over the past two weeks left the buyers exhausted

Polkadot [DOT] falls below $4.84, will the prices descend below $4 later this year?

Source: DOT/USDT on TradingView

On 2 August, DOT fell below a recent higher low at $5.1. Marked in orange, this denoted a market structure break in favor of the bears. Thereafter, the price bounced between the $4.95 and $5.06 levels until 15 August.

About 36 hours before press time saw the bears seize the initiative. On the back of a Bitcoin [BTC] rejection at $29.6k, the DOT sellers forced prices to fall as deep as $4.62 on 15 August.

The Directional Movement Index showed a strong bearish trend was close, and the RSI also signaled strong bearish momentum. In contrast, the CMF logged a notable influx of capital into the DOT market.

Fibonacci retracement levels (yellow) were plotted based on the mid-June rally. The 78.6% level at $4.59 was one that bulls must defend. It has confluence with the bullish D1 order block from June.

A daily trading session close below $4.59 would signal bears remained dominant. It would likely spur a move downward to $3.92.

The Open Interest and funding rates supported the bearish idea

Polkadot [DOT] falls below $4.84, will the prices descend below $4 later this year?

Source: Coinglass

The Open Interest saw some gains from 8 August to 11 August. During this time DOT hovered around the $5 support level. After 15 August, the OI saw a sharp plunge as prices dropped. This suggested bearish sentiment in the market, but did not point toward a rise in short positions in the market.

Polkadot [DOT] falls below $4.84, will the prices descend below $4 later this year?

Source: Coinglass


Realistic or not, here’s DOT’s market cap in BTC’s terms


The funding rate dropped deep into the negative territory. It had a reading of -0.0182% at the time of writing, according to Coinglass data. Together, the OI and funding rate showed bears had an advantage.

The funding rate flipping negative suggested the majority of the market was looking to sell DOT. This was not good news for long-term bulls who would want to see the $4.6 level defended. A Bitcoin recovery was one thing that could help DOT buyers.

Share

Akashnath Sumukar works as a Senior Journalist at AMBCrypto. Based in Chennai, India, he has been an avid follower of the cryptocurrency market since Bitcoin’s boom and bust cycle of 2017. A graduate in Chemical Engineering, he is an expert in technical analysis. In fact, Akashnath has a particular interest in reading price charts and predicting how an asset will move over the short and long term. A self-taught trader and as someone who holds cryptos himself, he is always on the lookout for the next opportunity he can possibly capitalize on, while also educating his audience.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.