Signs of a possible breakout mean this for Polkadot
With the market starting on a high note as October began it really did seem like bulls woke up as September ended. Bitcoin and Ethereum both noted close to 13% gains in just one and a half days as the market cap surged by over 10%. While most of the top altcoins rallied on this renewed bullishness, Polkadot, the 9th ranked alt too saw 7.12% daily and 8.87% weekly gains.
Even though DOT’s recovery was more market-centric and happened alongside the larger space, there were prominent signs that pointed towards a possible breakout for the altcoin.
Price action and metrics turned bullish
Polkadot’s price on the daily chart is seeing a parabolic recovery similar to the one witnessed towards the beginning of the year. At the time of writing, DOT was testing the long-term support level of $32.3 and flipping of the same would confirm further upward momentum. Further, Relative Strength Index on the daily chart for the alt saw an almost vertical uptick highlighting high cash inflows.
In fact, the altcoin’s futures and perpetual market also started turning green as prices gained momentum. Notably, as per data from Coinalyze, Open Interest saw a 15% jump in just 24 hours as $1.3million shorts were liquidated on futures and perpetual markets.
Further, DOT’s percent of stablecoin supply held by whales with more than 5 million USD, which was on a downtrend finally saw a steady rise as prices seemed to move.
Growing network strength
In a recent interview, Gavin Wood suggested that parachains are ‘technologically’ ready to launch and it is now down to the platform’s governance process to set that in motion, this heightened anticipation from the community.
Notably, one reason why DOT continued to hold string was that its staking rate has been holding steady at approximately 63.7%. Further, development activity too is seeing a steady rise as the development activity contributors count continued to remain constant for over a year now.
Thus, while futures market and metrics seemed to be turning positive, one thing that lacked from DOT’s market was high trade volumes. Previous rallies were all backed by high trade volumes and high activity on that front can yet again confirm a strong rally for the alt.