Polkadot (DOT) price has flipped a crucial resistance level to support. It is expected to increase by at least 20% in April.
Weekly outlook
The Polkadot (DOT) price has been trading below the 20-week moving average (MA) since breaking below it in November 2021. This line has rejected prices multiple times, leading to a yearly low of $4.22 in December 2022.
Afterward, the DOT price increased and broke above the 20-week MA before approaching the long-term resistance zone at $7.6. Although it was rejected, the DOT price has successfully confirmed this MA line as support (green arrow). This is an important development because the 20-week MA is often used to determine long-term trends. Therefore, the long-term downtrend may have ended.
Currently, the DOT price is likely to rise to the $7.6 resistance zone again, marking a 20% increase from the current price level.
The RSI indicator has completed a bullish Failure Swing pattern by moving up above the high level between divergences and is sloping up, supporting the possibility of a price increase for DOT.
Bullish pattern
After being rejected by the $7.4 zone, the DOT price dropped below the important support level of $5.9. However, this action turned out to be only a deviation as the price quickly recovered this zone and confirmed it as support on March 15th and 27th (green arrows). Such a deviation often leads to a strong upward trend thereafter.
In addition, this action has also formed a double bottom pattern. This is a price increase pattern that often leads to the continuation of the uptrend.
The RSI indicator has broken above the decreasing divergence line and is above 50, supporting the continuation of the uptrend.
Therefore, the DOT price is likely to continue to rise to the recent high of $7.6.
Conclusion
The most likely outlook shows that the DOT price will rise in April. The nearest target is $7.4 and higher to $9.5.
Breaking and closing below the 20-week moving average ($0.59) would invalidate this possibility and show that the price will drop to the annual low of $4.22.
Disclaimer: Please note that this article is for informational purposes only and should not be taken as investment advice. As an investor, it is important to do your own research before making any decisions. We are not responsible for any investment decisions you make based on this information. Not Financial Advice.
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