Polkadot (DOT) has registered a substantial decline during the current session and is down over 2% as bearish sentiment continues to dominate the market.
DOT has struggled to push above $4.20 and the 20-day SMA and has experienced considerable volatility since the beginning of the week. Despite its recent struggles, analysts remain hopeful of an imminent breakout.
Polkadot (DOT) Continues Lackluster Performance
Polkadot (DOT) was in the red almost all of last week, dropping below crucial support levels and the 20 and 50-day SMAs. DOT registered a substantial decline on Friday, dropping over 5% and falling to a low of $3.84 before recovering and settling at $3.99. It recovered over the weekend thanks to strong support, rising by 1% on Saturday to push back above $4 and settle at $4.03. DOT remained bullish on Sunday, registering an increase of 2.48% and settling at $4.13 to end the weekend on a bullish note.
Source: TradingView
DOT encountered significant volatility on Monday as buyers attempted to push above the 20-day SMA and sellers tried to drag it below $4. As a result, DOT reached an intra-day high of $4.22, dropped to an intra-day low of $4, and then settled back at $4.13. Buyers tried to push above the 20-day SMA on Tuesday as DOT reached a high of $4.25. However, buyers lost momentum at this level, and DOT fell to $4.19, registering an increase of 1.45%. Wednesday saw selling pressure increase as DOT dropped to a low of $4.12. However, it recovered from this level and registered a marginal increase to $4.20.
The current session has seen bearish sentiment return, with DOT down by almost 2.50% and trading around $4.10.
Can Polkadot (DOT) Slip Below $4?
So, can Polkadot (DOT) slip below $4? Despite its lackluster performance, Most analysts believe DOT is primed for a strong recovery. DOT’s recent drop does not seem to have adversely impacted sentiment around the token, with trading volumes remaining stable. Traders have continued to show interest in the asset, with no significant change in market capitalization reported. DOT’s trading pattern suggests limited immediate gains, although investor confidence remains high.
If we look at the price chart, DOT has two key support levels at $4 and $3.62. It is also facing resistance at $4.20 and $4.50. DOT is trading in a narrow range between $4 and $4.50 since the beginning of October. Further analysis also reveals considerable trading activity around $4, indicating it has become a strong technical and psychological support level. If DOT can defend its support levels, a change in market sentiment could result in a substantial breakout. Recently, one analyst predicted DOT could see a 27x increase from its current level, stating that a breakout is imminent.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
