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What next as DOT consolidates near $5.0

2min Read

Polkadot takes cue from BTC and enters a price consolidation above $5. Which way will the breakout go?

What next as DOT consolidates near $5.0

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

  • The recent rally has entered a price consolidation above $5.
  • DOT’s Open Interest rates fluctuated amidst neutral sentiment.

Polkadot [DOT] recovered from substantial losses in early June after Bitcoin’s [BTC] sharp rally. However, DOT was far from reclaiming its April high of $7. It traded at $5.08 at the time of writing and remained constricted within a key price range since 24 June. 

Read Polkadot’s [DOT] Price Prediction 2023-24

A recent report examined Cosmos and Polkadot ecosystems – enumerating positive similarities while acknowledging likely downsides. In the meantime, BTC consolidated above $30k, reinforcing the bulls’ expectation of further upside move. 

Consolidation before a pump?

Source: DOT/USDT on TradingView

Initially, DOT consolidated within the $4.3 – $4.7 range between 10-20 June. It inflicted a bullish breakout on 20 June following BTC’s sharp rally to $31k, hitting a recent high near $5.21. With BTC fluctuations above $30k, DOT also chalked a near-term range formation above $5.0. 

DOT’s price action has been constricting within the $5.0 – $5.21 range since 23 June. Unless BTC gives a clear direction, DOT’s short-term range bound could persist in the next few hours/days. So, targeting range extremes could offer minimal gains.

A bearish breakout and subsequent crack of $5.0 support will show weakness in the H4 structure. 

In the meantime, the RSI sideways structure above the median mark and CMF (Chaikin Money Flow), indicated that buying pressure steadied, but capital inflows were positive. However, a breach of $5.0 support will expose $4.7 to a likely retest. 

Open Interest rates fluctuated

Source: Coinglass

DOT’s fluctuations above $5.0 have also been marked by Open Interest (OI) rate fluctuations below $140 million. From 20 June, the OI, which tracks contracts in the futures market and overall sentiment improved, but faltered at $140 million. 

How much are 1,10,100 DOTs worth today

Also, the DOT Exchange Long/Short ratio reinforces a neutral sentiment with a little spread between long and short positions. Taken together, the futures market’s short-term outlook was neutral. Speculators should track BTC’s movement for better clarity.

Source: Coinglass


Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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