Polkadot Price Forecast: DOT suffers Another Rejection At $20 As Sell Signals Multiply
- Polkadot price rejected at $20 again as losses loom toward $16.
- A sell signal on the 3-hour chart by the TD Sequential indicator adds credibility to the trend correction.
Polkadot has engaged reverse gears hours after rallying to $20. The selloff in July saw DOT test support at $10.5. However, a recovery ensued soon after, paving the way for a bullish trajectory to $20. Indeed, the bullish leg stretches further, with the last spring occurring on Thursday morning during the Asian session.
As the European session was ushered in, Polkadot has begun trimming gains. From the monthly highs of nearly $20, the token is exchanging hands at $18.3.
Polkadot Price Correction On Course
According to the Moving Average Convergence Divergence (MACD) indicator, losses are lurking at the periphery. With a sell signal about to be flushed, the odds for the correction extending under the ascending trend line will go up significantly.
Realized that the MACD follows the trend of an asset and calculates its momentum. As the moving average oscillates in the direction of the trend, buy or sell signals are sent. Polkadot's four-hour chart shows the 12-day EMA about to cross below the 26-day EMA, which will be a call to offload the token.
It is essential to consider that sellers are already in control, based on the Relative Strength Index (RSI). Like the MACD, the RSI tracks the asset trend but calculates the strength of the bulls and bears. As the RSI moves from the overbought region, bears gain more traction, thus, enhancing Polkadot's correction.
DOT/USD four-hour chart
The TD Sequential indicator, which can be used in identifying the positions where an asset's uptrend or downtrend exhausts itself, has presented a sell signal on the three-hour chart. This indicator is useful when looking for price points where one can buy or sell.
A sell signal comes in a green nine candlestick, and it implies that upward momentum is fading as bears prepare to take over. It is validated when its low closes the day above the lows of the sixth and seventh candles. Most of the previous sell signals have been validated, suggesting that overhead pressure should be expected to soar in the coming sessions.
DOT/USD three-hour chart
It is worth mentioning that Polkadot is moving toward an ascending trend liner which has since July 20 mitigated losses from extending further. As long as the price rebounds from this level, DOT will have another chance to battle the crucial resistance at $20 and perhaps continue with the uptrend toward $30.