Polkadot (DOT) Faces Challenges Amid Binance Case and Security Classification  - COINTURK NEWS
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Polkadot (DOT) Faces Challenges Amid Binance Case and Security Classification 

4:40 pm (174 days ago)
June 14, 2023

Polkadot (DOT) is just one of the assets recently referred to as a security by the U.S. SEC during a recent Binance case. Alongside macro winds, its classification as a security led to a substantial decline for DOT last week (June 5-10). 

Polkadot Price

However, the fall eased on June 10, with DOT striving to reverse its recent losses. At the time of writing, DOT was trading at $4.66, marking a 3% increase in the last 24 hours, according to CoinMarketCap. Similarly, Bitcoin (BTC) surpassed $26,000 ahead of the May U.S. Consumer Price Index (CPI) data. 

After the Binance case and the subsequent categorization of DOT as a security, DOT finally fell below the short-term range formation (white) that started on May 8. It consolidated between $5.0 and $5.51 before falling below the lowest level of the range in 2022 and reaching $4.2. 

The prolonged fall on June 10 left a Fair Value Gap (FVG) between $4.53 and $4.8 (white). Notably, the FVG region aligns with the key resistance level (at $4.68) from late December 2022 and early January 2023. Thus, it stands as a crucial resistance to be overcome by the bulls. 

If the rally stops at the above resistance, DOT could fall back to $4.33 or $4.2. These levels could act as short-selling targets. 

Negative Funding Ratio for Dot

However, a session close above the $4.8 FVG region could invalidate the bullish thesis above. Additionally, another FVG region between $4.84 and $4.93 is close to the previous low range around $5. Therefore, a move above $4.8 could face resistance near $5. 

Meanwhile, the Relative Strength Index (RSI) reached the median mark and might face little resistance before attempting to move upwards and relieve buying pressure. Conversely, the Chaikin Money Flow (CMF) sharply rose above the zero mark, indicating significant capital inflows into DOT. At present, it continues to trade around 109 TL. 

Most Central Exchanges (CEX) have reported negative funding rates for DOT since June 10, potentially delaying a strong rally. However, more short positions have liquidated than long ones in the past four hours. This suggests a growing bullish momentum ahead of U.S. CPI data. Therefore, mixed signals call for caution before making a move and following BTC price movements. 

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