Polkadot price analysis continues to indicate a bearish outlook as the market undergoes a significant decline. Over the last 24 hours, the price of the asset has seen a slight decline, indicating a sideways movement under the influence of bearish sentiment.
There was limited movement in the DOT price on the weekly time frame. In terms of technical indicators, DOT is showing bearish strength with little buying pressure. Both demand and accumulation levels have decreased according to the daily chart.
Due to the indecisiveness in the Bitcoin chart, many altcoins, including DOT, either remained capped at the immediate resistance level or entered a consolidation phase. The key for DOT is to maintain the price level above its immediate support to avoid the possibility of another substantial decline in the coming trading sessions.
If the selling pressure intensifies, there is a risk that the altcoin will break below its key support level. Polkadot’s falling market cap suggests that sellers are still exercising control over the asset.
Polkadot Price Analysis: One Day Chart
Currently, DOT is trading at $5.29, with Polkadot hovering near its critical support level of $5.15. If the price were to fall below this level, it may further fall to as low as $5. On the upside, a significant resistance level is seen at $5.40.
If the DOT bulls manage to break through this resistance, it could potentially trigger a rally towards $5.71, suggesting a 6% appreciation.
Further progress could then lead the price to the $6 zone. Notably, the trading volume of DOT in the last session was relatively low. This suggests that buying power has been weaker compared to selling pressure.
Technical analysis
Demand for DOT remained relatively weak during the months of April and May. Analysis shows that the Relative Strength Index (RSI) remained below the 40 mark, indicating that selling pressure has outweighed buying pressure in the market.
Additionally, the DOT remained below the 20-Simple Moving Average (SMA), further confirming the dominance of sellers in driving price dynamics.
However, if DOT manages to break above $5.30, it has the potential to climb above the 20-SMA. This could potentially attract buyers back into the market and shift overall sentiment in a more positive direction.
As demand for DOT fell, the altcoin showed bearish buy signals on its one-day chart. The Moving Average Convergence Divergence (MACD), which represents price momentum and trend reversal, was showing descending green histograms, indicating a weak buy signal for DOT.
In addition, Bollinger Bands, which illustrate volatility and price swings, showed narrowing, indicating a range-bound movement.
The upcoming trading sessions are important for DOT as they will determine whether the price will go above or below a critical support line.
Featured image from UnSplash, charts from TradingView.com
