Polkadot Price Prediction: DOT Technical Breakout Sabotaged as Overhead Pressure Soars Under $40

Last Updated July 23rd 2021
2 Min Read
  • Polkadot’s recent breakout from an ascending triangle pattern eyed gains to $48.
  • Immense seller congestion at $40 culminates in an ongoing correction.
  • A four-hour candlestick above $40 could validate the uptrend.
  • Polkadot, alongside other major altcoins, spiked in the last 24 hours. The selected crypto assets posted double-digit gains before hitting barriers at various price levels. Polkadot bounced off support provided by the 100 Simple Moving Average (SMA) on the four-hour chart and lifted to $40.

    However, little progress was made above this level due to the increase in overhead pressure. Following the resistance, a correction is underway, whereby Polkadot had dropped to $38. If the technical picture is unchanged, losses may gain momentum toward the primary support at $30.

    Polkadot is on the verge of a retreat

    Polkadot recently broke out of an ascending triangle pattern, insinuating a massive 27% upswing to $48, but the failure to make a four-hour candlestick close above $40 resulted in a spike in selling pressure.

    As attention shifts to securing higher support, the four-hour chart shows that the 200 SMA will come in handy. In conjunction with the triangle’s x-axis, this buyer congestion zone could keep the bulls’ advances at bay.

    Meanwhile, the Relative Strength Index (RSI) emphasizes the growing selling pressure as it moves toward the midline. This indicator follows the trend of an asset and measures its strength. It also identifies overbought and oversold conditions.

    DOT/USD four-hour chart

    dot/usd 4-hour chart 050621

    If push comes to shove and Polkadot closes the day under the 200 SMA, the bearish leg will most likely extend further. The 50 SMA is in line to provide support at $36, while the 100 SMA is the primary anchor at $34.4.

    The TD Sequential indicator may present a sell signal on the four-hour chart in the coming sessions. This call to sell will manifest in a green nine candlestick, suggesting that the uptrend is likely to lose traction and give way to the overhead pressure.

    DOT/USD four-hour chart

     dot/usd 4-hour chart 050621

    The call to sell is validated when the nine and eight candlesticks close higher than the six and seven candlesticks. Currently, securing higher support is a top priority in the bullish camp, while trading above $40 could bolster Polkadot toward $48.

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