Analysis
Polkadot price sets a new high for 2023 – Time to alter predictions?
Given the positive Delta, bulls are more overleveraged, making hunting their levels a more likely outcome.
- Polkadot prices reached $8.58 on 22nd December before slipping lower.
- This was a new high for 2023 and the market structure supported the idea of another rally.
Polkadot [DOT] gained 47% in December and has rallied 20% within just the past two days based on the prices at press time. The blockchain also saw a major increase in its revenue, which pointed toward increased usage.
The recent rally past $7.9 meant DOT has registered a new high for 2023. The technical structure showed that further price gains were likely after a minor step backward in the coming days.
The bearish order block was about to be broken
Source: DOT/USDT on TradingView
At the time of writing, DOT had closed a one-day trading session above $7.9. In the next few days, a retest of the $7.2-$7.9 region can be expected. After that, the token will likely continue its rally and push toward new highs.
The $7.2-$7.9 area represented a bearish order block on the one-day chart. The chart above was a three-day chart, which highlighted the strong bullish structure of DOT on the higher timeframe chart.
Moreover, it also underlined the next key resistance at $9.65. This level was a high from August 2022.
Whether such a rally would occur this month or in January 2024 is unclear. The OBV has risen higher without pause, and the RSI was at 75 to highlight intense bullish momentum.
What does the lower timeframe data indicate?
Source: Hyblock
Prices are inevitably attracted to liquidity. Hence, AMBCrypto analyzed the liquidation levels to understand where DOT could move next.
The Cumulative Liq Levels Delta was still deep in the positive territory even after the drop from $8.5 that commenced in the past 12 hours.
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There were large liquidity pockets to the north as well as the south. Given the positive Delta, bulls are more overleveraged, making hunting their levels a more likely outcome.
From the data above, AMBCrypto noted that there were significant liquidation levels till $6.93. Of note were the $7.81, $7.5, and $7.3 levels where a reversal could also occur.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
