Polkadot Price Analysis: DOT seems poised to retrace as technicals flash sell signal
- Polkadot’s four-hour chart has flashed a signal, triggering a downtrend.
- The four-hour DOT chart is trending in a parallel channel formation.
Polkadot had fallen from $6.29 on August 3 to $3.75 on October 6. Since then, DOT has ebbed and flowed and is currently trading for $4.38. Technical analysis shows us that a price retracement may be in order.
DOT trends in a parallel channel
Polkadot has flashed the sell signal in the 4-hour chart in the TD sequential indicator. This shows that the price is going to enter a downswing soon. The last time Polkadot flashed this indicator, DOT fell from $4.58 to $4.15 in five sessions.
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DOT/USDT 4-hour chart
To understand how far DOT will drop, let’s take another look at the 4-hour chart. It looks like the “Ethereum killer” is presently trending in a parallel channel. If the sell signal is validated, DOT could pull back to the channel's lower boundary at $4 before the uptrend resumes.
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DOT/USDT 4-hour chart
So, we can conclude that while the price is going to enter a downtrend, the parallel channel will make sure that DOT remains in a healthy range.
Author
Rajarshi Mitra
Independent Analyst
Rajarshi entered the blockchain space in 2016. He is a blockchain researcher who has worked for Blockgeeks and has done research work for several ICOs. He gets regularly invited to give talks on the blockchain technology and cryptocurrencies.
