Polkadot price rebounds 11% – Can DOT extend its rally to $1.75?

Polkadot [DOT] has extended its bullish recovery by recording a 10.93% to $1.27 over the last 24 hours. The move comes just two days after the token price action rebounded from key EMA support at around $1.02.

Interestingly, the bullish advances follow a 54% reduction in annual token issuance and the launch of a native stablecoin, two developments that could strengthen the network’s long-term outlook.

At the same time, the network’s increasing Open Interest (OI) and a growing preference for leveraged long positions also point to increased trader participation. Could the token’s sustained buying pressure turn these developments into a lasting DOT recovery?

Tokenomics changes strengthen Polkadot’s outlook

The reduction in annual token issuance marks a significant shift in Polkadot’s tokenomics. Fewer new tokens entering circulation equates to reduced selling pressure. Its circulating supply currently ranks 36th among the L1 tokens.

Meanwhile, the launch of a native stablecoin could expand activity across the ecosystem. Stablecoins support payments, decentralized finance (DeFi) applications, and liquidity, potentially creating new use cases for Polkadot.

Together, these developments offer investors additional reasons to reassess DOT’s prospects after its prolonged price weakness.

Derivatives data reveals a strong preference for longs

Zooming down to the Polkadot’s derivative data, its OI has also increased 15% to $78 million as of writing, suggesting traders are opening new positions as the token advances.

Notably, long accounts now represent 73% of total leveraged positions, according to the recent Polkadot’s Long/Short data, suggesting that most traders and investors are betting on further gains for the token.

Can DOT sustain its recovery above $1.27?

On the daily chart, DOT has rebounded from support near $1.02 to reach $1.27, marking a notable improvement in its short-term structure. Besides, the token is now trading above all its key EMA support, pointing to potential buyer dominance continuation in the short run.

Holding above reclaimed support could strengthen the case for further gains, while renewed selling could expose the token to another test of lower levels.

All in all, Polkadot’s issuance reduction, stablecoin launch, and increased derivatives activity provide potential catalysts for continued price appreciation to $1.75.

Final Summary

• DOT prices have jumped by 10.93% to $1.27, extending its two-day recovery from EMA support near $1.02.
• The recent network upgrade paired with surging open interests and buyer dominance, points to a continuation rally.