- Polkadot price suffered the same drop and selling pressure experienced by the broader crypto market.
- DOT is relatively unchanged despite the fall and has maintained a stable support zone.
- Bear trap set up on the Point and Figure chart indicates near-term bullish momentum.
Polkadot price continues to trade in a range between the 38.2% Fibonacci retracement at $31 and the 50% Fibonacci retracement at $26. However, the Point and Figure chart shows a possible Bear Trap Point and Figure pattern may play out.
Polkadot price could trigger a bullish reversal and spike higher to the $50 value area
Polkadot price is ready to surprise the market and return to a bull market. There is a highly positive bullish confluence of activity for DOT at the entry level of the Bear Trap pattern currently developing on the $1.00/3-box reversal Point and Figure chart. If the entry identified below triggers, Polkadot will simultaneously confirm the Bear Trap pattern and breakout above the bear market trendline to convert DOT into a bull market.
The hypothetical long setup off the Bear Trap setup is a buy stop order at $32, a stop loss at $28, and a profit target at $50. This trade setup represents a 4.5:1 reward/risk and has an implied profit of 60% from the entry. A two to three-box trailing stop would help protect any profit made post entry.
DOT/USDT $1.00/3-box Reversal Point and Figure Chart
Polkadot price can move one box lower to $25 before the entry is triggered. If that occurs, the Bear Trap pattern turns into a Bearish Fakeout setup, an even stronger bullish reversal pattern. However, a drop to $24 before the entry is triggered would invalidate the hypothetical long setup.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.