Polkadot [DOT] to $20 or back to $9? Here’s what you should know

• Market sentiment around DOT remained bullish. 
• If a price correction happens, DOT might plummet to $9.

Polkadot [DOT] had a comfortable week as its value surged by more than 13% in the last seven days.

At the time of writing, DOT was trading at $10.95 with a market capitalization of over $14 billion, making it the 13th largest crypto, per CoinMarketCap.

If the latest data is to be considered, DOT might showcase better performance in the coming weeks, as there are chances of it touching $20 soon. 

Is Polkadot setting up a show?

DOT’s Social Volume also rose at this time, which reflected its popularity in the crypto space. But despite this, the token’s 24-hour trading volume dropped.

Source: Santiment

Also, on the 12th of March, World of Charts posted a tweet highlighting an interesting development around DOT. The analyst noted that the token’s price might plummet to $9 before initiating a rally.

If DOT rebounds from $9, then the chances of it touching $20 are high.

Therefore, AMBCrypto decided to check whether the chances of DOT sinking to $9 were high. Our analysis of Hyblock Capital’s data revealed that Polkadot experienced high liquidation in the last few days.

To be precise, DOT’s liquidation increased between $10.8 and $10.9.

This was probably the reason behind DOT’s sluggish 24-hour performance, as its value only moved marginally. The hike in liquidation might soon result in a slight price correction. 

Source: Hyblock Capital

What to expect from DOT?

AMBCrypto’s analysis of Santiment’s data revealed that DOT’s demand in the derivatives market dropped.

This was evident from the plummet in its Binance Funding Rate, meaning that derivatives investors were not buying Polkadot at its high price, hinting at a price correction.

Its 1-day price volatility also sank, which indicated that DOT’s bull rally might end. 

Source: Santiment

To better understand whether DOT’s price can reach $9 before starting another rally, AMBCrypto then took a look at its daily chart. Notably, Polkadot’s price touched the upper limit of the Bollinger Bands.

Its Relative Strength Index (RSI) also registered a downtick, hinting that the chances of a price decline were high.

If the price drops, it will be interesting to see whether DOT manages to rebound from the support zone to reach $20. 

Source: TradingView

Read Polkadot’s [DOT] Price Prediction 2024-245

In the meantime, Polkadot’s network activity increased last week. Our analysis of Artemis’ data revealed that DOT’s Daily Active Addresses shot up in the last seven days.

As a result, the blockchain’s Daily Transactions moved northward. 

Source: Artemis