- Polkadot retreats from record highs at $30 amid widespread crypto declines.
- Support at the 50 SMA and the ascending channel’s middle boundary must hold to avert losses eyeing $20.
- Recovery to $30 will resume if the immediate support at $25 remains intact.
Polkadot has recently hit a new milestone at $30. The rally has been steady and consistent, especially in February. An ascending parallel channel also came into the picture, which helped control DOT’s downward price actions.
Polkadot has retreated from the all-time highs at the time of writing and is exchanging hands at $25. If the immediate crucial support fails to hold, the price will tumble toward $20.
Polkadot depends on crucial support to avert potential losses
The ascending parallel channel lower boundary in conjunction with the 50 Simple Moving Average (SMA) on the 4-hour chart provides Polkadot with immediate support. Failing to hold above this critical support will be a massive bearish signal.
On the downside, the next tentative support is the 100 SMA, near $20. If push comes to shove, the 200 SMA will come in handy to stop declines from extending below $20.
The Moving Average Convergence Divergence (MACD) adds weight to the bearish outlook. When used properly, the MACD strategy can help traders identify positions to sell the top and buy the bottom. The MACD line (blue) crossed under the signal line, suggesting that it was time to sell the top. For now, the least resistance path is downwards until formidable support is established.
DOT/USD 4-hour chart
Santiment, a leading behavioral analytics platform, shows that Polkadot attracts massive social media volume on its run-up to $30. The social volume model tracks the number of mentions of a coin on more than 1,000 crypto social media channels such as crypto subreddits, discord groups, and Telegram groups.
A sudden spike in the volume is not a bullish signal. Often investor sentiment flips bearish, and selling pressure begins to mount. Therefore, Polkadot’s retracement seems to have been validated and could continue if bulls fail to secure higher support.
Polkadot volume chart
Looking at the other side of the fence
Polkadot will avert the looming losses to $20 if the buyer congestion at the 50 SMA on the 4-hour is dispersed. This region is reinforced by the ascending channel’s lower boundary, suggesting that support could remain intact. A rebound from this support will pave the way for gains back to $30.
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.
Follow us on Telegram
Stay updated of all the news
Two key dates over the SEC request to freeze Binance assets
Crypto exchange Binance must respond to the US Securities Exchange Commission’s (SEC) order to freeze assets tied to its subsidiary Binance.US by June 12, ahead of a court hearing about the case on June 13, according to the D.C. district court schedule.
Ethereum price declines as Coinbase ETH liquidity staking platform sees mass withdrawals
The US Securities and Exchange Commission’s (SEC) crackdown on Coinbase led to mass withdrawals of Coinbase wrapped staked Ether (cbETH) since Tuesday, acting as a bearish catalyst for the asset’s price.
Dogecoin Price Prediction: History suggests a potential 30% rally in DOGE
Dogecoin (DOGE) price has been trading within a fixed range over the last six months, taking seasonal leaps as volatility increased. With this accumulation pattern, the king of meme coins could be en route to complete the next bounce cycle.
Axie Infinity price recovery delayed despite investor deposits hitting a five-month high
Axie Infinity price, following the broader market cues, is trending downwards for the moment as the bearishness in the market has grown considerably. Incited with the regulatory crackdown by the SEC, the investors have resorted to offloading their holdings for now.
Bitcoin: BTC targets $30,000 as short-term bias turns bullish
Bitcoin (BTC) price shows a clear sign of the bulls’ victory. After failing to trigger a steep correction, bears look now out of context, at least in the short term, allowing buyers to restart a minor uptrend.