After rejecting a vital resistance level earlier this week, Polkadot’s price slipped and remained calm above its 2-year low. A crash from there could see the price tank by 25% before finding a solid level for recovery.
Last month saw many top altcoins through a mini-recovery as they increased above their immediate resistance levels. DOT, on the other hand, failed to break out after posting 8% gains in three weeks.
The gains washed away following a quick bearish interception at $4.3 on Monday. Selling volume dropped afterwards and volatility remained extremely low by the day. The asset is yet to find a solid ground level for a bullish reversal.
However, it established temporal support above $3.9 last month and has taken a break in the bearish cycle ever since. While the asset remained in a consolidation phase, it is currently gathering liquidity and at the same time looking for a key level to initiate a fresh drop.
Should such a scenario come into play, DOT could see a 25% crash to $3. This price level coincides with the lower boundary of the wedge, forming on the daily chart. However, a notable break above the wedge could facilitate a fresh increase from a short-term perspective.
So far, DOT has lost almost 50% of its value in the past seven months as it looks bearish on the daily chart.
DOT’s Key Levels To Watch
As the bears target lower levels, they must crack the $3.91 support to mark a new low at $3.6. If a retracement fails to occur from there, the next selling target to keep in mind is $3.3.
This week’s $4.3 high remains a primary resistance to watch for a breakup. Higher resistance levels to keep in mind are $4.55 and $4.81 in case of a more increase.
Key Resistance Levels: $4.3 $4.55, $4.81
Key Support Levels: $3.91, $3.6, $3.3
- Spot Price: $4
- Trend: Bearish
- Volatility: Low
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.