Bitcoin‘s impressive surge towards $30,000 on August 9th has created a wave of optimism in the crypto world. Despite Polkadot‘s (DOT) dominant downward trend, the possibility of a reversal has become more apparent.
Responding to these market conditions, DOT managed to record a promising 4.5% increase in the last 48 hours, positioning its current price at a notable level of $5.05. Considering DOT’s ability to maintain its stance above the critical $5 level and Bitcoin’s continuous upward trend, the native token of the Polkadot network could be on the verge of a significant price rejuvenation.
Current State of Polkadot Price
After encountering price rejections in the $5.6-$5.85 range on both July 14th and July 21st, the support level of $5.23 was breached by bears. However, seller momentum decreased at this point and buyers effectively balanced the price around the $5 benchmark.
DOT buyers are encouraged by the overall market’s price resurgence. The Chaikin Money Flow (CMF), an important indicator, highlights this increasing buyer sensitivity. Departing from the neutral zone, CMF exhibits a strong shift and reaches a commendable +0.20 level, indicating rapid capital inflow. Similarly, the Relative Strength Index (RSI) provides insight into a recovering buying move by progressing towards the balanced 50 mark from the previous stagnation in the oversold zone.
Equipped with these criteria, bulls may be preparing to resist bears in the crucial $5.23 price range. Successfully converting this resistance into support could pave the way for potential gains ranging from $5.50 to $6.
Possible Price Decline
However, any resistance encountered here, especially if Bitcoin’s rally fluctuates, could potentially push DOT’s price down to $4.5. Another glimmer of hope for buyers can be stated as DOT’s positive funding rate in the previous 24 hours, as reported by Coinglass. This reversal in the funding rate could serve as the catalyst needed to spur buyers into action.
On the exchange front, the long/short ratio highlights a marginal but significant shift in favor of buyers during the ebb and flow. Long positions have a slight edge with a 50.1% majority in the shorter four-hour window. This subtle dominance indicates the potential for an upcoming rally that could extend gains over longer timeframes.
