Disclaimer: The findings in the following analysis are the sole opinions of the author and should not be taken as investment advice.
Polkadot’s price action has looked solid for the past 30 days, posting gains of more than 110%. On the charts, the alt did not waver despite several hurdles presented on its way to its mid-May levels. However, there appeared to be some short-term risks that could limit DOT’s advantage.
These were present at the 200-SMA (green) and swing highs of $ 28 and $ 31. Given these challenges, traders should prepare for an interesting week ahead. These developments could have a radical impact on DOT’s medium and long-term trajectory.
Polkadot daily chart
Buyers have not been disappointed in the DOT market. Sustained upward pressure forced the price to rise above the daily 20-SMA (red) and 50-SMA (yellow), both of which are often used to gauge the level of market momentum. The last position in the uptrend was at the 200-SMA (green), which would validate the DOT’s staggering return from its late-July lows.
Also, expect the market skeptics to be totally off the scene when the price closes above $ 31. In fact, the 200-SMA had the potential to negate a bullish thesis. A double top formation also seemed vulnerable to collapse if the DOT tops out at $ 28.6 and fails to close higher. In such a case, the focus would shift to the defensive zone of $ 18.4 to $ 19.4, the baseline for bullish control.
The Relative Strength Index has peaked in the overbought zone for the past few days. Requires immediate stabilization before the next leg up. While the RSI increased the chances of a short-term dip, buyers are expected to respond quickly.
The MACD has been trading above the midline for over two weeks, a sign of bullish strength. Finally, Awesome Oscillator reached its highest level in more than 4 months. Such accumulation was last seen in early April, when the DOT peaked at $ 46.7.
Polkadot can be expected to continue his upward journey in the coming weeks. Indicators held bullish positions, although a short-term pullback seemed likely. In such a case, the DOT will have to bear losses in excess of $ 18.4 to preserve a favorable outlook.
This is a machine translation of our English version.
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