Polkadot Price Forecast: DOT Approaches Potentially Gigantic Breakout to $38
- Polkadot holds in consolidation ahead of 48% upswing to $38.
- The symmetrical triangle could end in a bullish breakout, but DOT must break the 50 SMA resistance.
Polkadot is pivotal around $22.7 after delaying the weekly target at $28. The potential uptrend failed to break above the 50 Simple Moving Average (SMA) on the four-hour chart. DOT’s downside seems to have been protected at $22, thus, avoiding the bearish leg that could stretch to $11.5.
As the consolidation period continues, signs of a colossal breakout are starting to emerge. The same four-hour chart illustrated a symmetrical triangle. Note that bringing down the immediate hurdle at the 100 SMA and the 50 SMA will push Polkadot closer to the massive upswing.
Polkadot sustains bullish outlook
A symmetrical triangle forms after an enormous movement in price, mainly to signify consolidation before another significant price action. Two trend lines form the pattern, connecting a series of higher lows and higher highs.
The trend lines meet at a relatively equal spot, but a breakout is expected before that happens. As the distance between the lines narrows, Polkadot consolidates. Note that the symmetrical triangle can culminate in both bearish and bullish biases.
When the price cracks the upper trend line resistance, it marks the beginning of an uptrend. On the other hand, a breakdown occurs when the price slices through the lower trend line’s support. Triangles also tend to have precise breakout targets, equal to the distance between the highest and the lowest points, as shown below.
DOT/USD four-hour chart
If the price continues with the uptrend past the 50 SMA and the downward slanting trend line, DOT will swing 48% higher to $38.
The prevailing bullish impulse is supported by the Moving Average Convergence Divergence (MACD) indicator. In addition, this trend’s momentum indicator has closed the gap to the zero line, adding credence to the bullish outlook.
Massive buy orders will be triggered if the indicator moves into the positive region. Moreover, some traders are perhaps waiting for the MACD line to widen the divergence above the signal line to increase their entries.
It is worth mentioning that closing the day under the 100 SMA may invalidate the upswing and call for more sell orders. Besides, the price crossing under the symmetrical triangle may add credence to the breakdown eyeing $11.5.