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In the cryptocurrency market, Bitcoin’s leadership has also led to notable rises in altcoin projects. Following this trend, Polkadot experienced a rise from the lower boundary of the current price range at $6.4 to a significant resistance area at the upper threshold.
Polkadot Chart Analysis
A close examination of the daily chart reveals that Polkadot is moving sideways, oscillating between the notable support level of $6.4 and the critical resistance at $7.4. This situation leaves the market uncertain about its future direction. Recently, Polkadot found support near the lower boundary of the range at $6.4, triggering an upward trend. However, this momentum decreased upon reaching the upper limit of $7.4, coinciding with the 200-day moving average, resulting in a minor rejection.
This indicates a balance between buyers and sellers, potentially leading to continued consolidation until a valid breakout occurs. In the short term, a slight downward trend targeting the critical $6.4 level is expected.
Analyzing the 4-hour timeframe, Polkadot’s price remains confined within a decisive range near the critical $6 level for support and around the $7.4 threshold for resistance, yet there is no clear sign of its next move. After a period of increase, the price once again encountered the critical resistance zone defined by the 0.5 (7.4 dollars) and 0.618 (7.8 dollars) Fibonacci levels.
The current movement near this significant resistance indicates potential seller dominance and insufficient upward momentum, likely leading to another downward trend. Consequently, a price drop and targeting the lower boundary of the range as the next goal are expected.
Polkadot Data Analysis
Amid the recent price uncertainty surrounding Polkadot’s potential trajectory, analyzing the sentiment in the futures market is crucial for predicting the cryptocurrency’s future expectations. The provided chart shows Polkadot’s daily timeframe price along with Open Interest and Funding Rates data.
The chart reveals a recent decline followed by horizontal consolidation, during which both OI and funding rates experienced significant drops to their lowest values. A similar pattern was observed at the beginning of 2024, which eventually led to increased demand and the start of a strong upward trend.
While both data points show notable declines, positions in the futures market appear ready for aggressive application, potentially leading to significant movement. Consequently, if the current consolidation phase results in intense demand and the application of long positions, the market may be poised to enter a notable upward trend targeting higher price levels.
