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Polkadot (DOT) Price Rejected by Long-Term Resistance, What Next?

The price of Polkadot (DOT) has been rejected by long-term resistance at $5.7 for the past 3 weeks. Will the upward momentum continue, or is it time for a reversal?

Weekly Outlook

The price of Polkadot (DOT) has risen since creating a deviation below the crucial support zone at $4.3 from September 4 to October 23, 2023 (green ellipse). These deviations are considered bear traps and are often followed by strong bullish movements.

Indeed, DOT’s price has surged and touched the $5.7 resistance zone in the following 2 weeks. Although rejected by this zone, DOT’s price has formed two weekly candles with long wicks afterward.

This is a sign of buying pressure, indicating that bulls are buying aggressively on minor dips.

The weekly RSI is rising and above 50, supporting the continuation of the upward trend.

Therefore, the price of DOT is likely to break above the $5.7 resistance zone in the near future. This could help the price rise to the next resistance zone at $7.7, a 46.39% increase from the current level.

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DOT/USDT weekly chart . Source: TradingView

Descending Parallel Channel

The 4-hour chart shows that the DOT price is trading within a descending parallel channel formed since the local high of $5.9 on November 13. This is a bullish pattern, often leading to breakouts in most cases.

However, the 4-hour RSI indicates an uncertain trend, moving around the 50 level.

Therefore, the short-term trend is still not considered bullish until the price breaks above the channel’s resistance line and the small horizontal resistance at $5.36.

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DOT/USDT 4-hourly chart . Source: TradingView

Conclusion

The most likely scenario suggests that DOT’s price will break above the long-term resistance zone at $5.7 and rise to the next resistance zone at $7.7.

However, the price needs to break above $5.36 to confirm this.

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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