Polkadot Price Analysis: Bearish Forces Continue To Melt Price?

• Polkadot was exchanging hands at close to $4.05; it is down 2.43% intraday.
• The RSI and the 14-day SMA line showcased a bearish crossover, indicating sellers’ domination in the near term.

Despite a strong recovery and improving sentiments in the crypto sector, Polkadot (DOT) is in meltdown mode. Bitcoin is edging closer to the $60K mark, indicating renewed confidence among investors. BTC’s ascent has triggered a buy signal for several altcoins.

Polkadot has failed to benefit from the improving market sentiments. At the time of writing, Polkadot was exchanging hands close to $4.05 recording an intraday loss of 2.05%. Currently at $6.048 Billion, the market cap of Polkadot is down nearly 6% over the week.

However, despite the downtrend, the price still hovers above the September lows, with investors anticipating a reversal. It remains to be seen whether the DOT bulls may register their presence to defend the monthly lows and make an effort for a price improvement.

Derivatives Traders are Liquidating Their Positions

Polkadot price has been under the control of bears since mid-March. During the said period, DOT has plummeted nearly 66% from its annual high. The key EMAs have been acting as a dynamic resistance levels.

In tandem with the price drop, the Open interest contracts have noted a liquidation on the long side. As per Santiment, the open interest contracts have dropped from $112 Million to $105 Million losing 6% In the last couple of sessions.

Moreover, the daily transaction volume has surged by 21% a day to $122.65 Million. The volume to market cap ratio at 1.99% suggests low volatility in the crypto.

Polkadot Bulls May Look to Defend the Lows

Despite the recent drop, DOT investors are optimistic about a potential buying from the monthly lows. Interestingly, the selling pressure has not invalidated a consolidation near the demand. Instead, the accumulation has intensified for nearly 45 days, giving hopes of a possible buying phase.

Moreover, the trend outlook is bearish in the long term which has been a concern for the buyers. DOT price lags nearly 44% below the 200-day EMA, reflecting bearish control.

Polkadot Price Prediction: is September Low in Danger?

Despite the recent efforts by the bulls and improved sentiments in the broader market, Polkadot has been unable to showcase recovery. Recently, the bulls attempted to recover, however suffered rejection; the price declined, losing all the gains.

While applying, the Fibonacci retracement tool from the recent swing high at $5.15 to a recent swing low at $3.8, the golden zone was observed between $4.4 to $4.6. The golden zone is crucial for the price to maintain a particular trend.

Looking precisely over the charts, it was observed that the same area acted as a reversal zone for Polkadot price. A rejection from the golden zone of Fibonacci validated the presence of sellers at the higher levels. On the lower side, a breakdown below the recent consolidation may indicate a bearish continuation.

Additionally, at the time of writing, RSI line and 14 day SMA line showcased a death crossover, indicating extended bearishness in the short term.

Disclaimer

This article is for informational purposes only and does not provide any financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.