- Polkadot ($DOT) has faced significant bearish pressure after failing to break through the $5 mark, with its price currently at $4.18.
- The cryptocurrency has struggled to maintain support, and if bearish sentiment continues, $DOT could drop further towards $4 or even $3.60.
Polkadot ($DOT) is once again grappling with significant bearish pressure after an earlier attempt to break through the $5 mark failed. Following a brief surge that saw $DOT touch $4.98 on August 16, the cryptocurrency has since retreated and is now trading at $4.18.
A Downward Trend
Polkadot’s recent performance has been underwhelming. After a promising start to August, $DOT encountered resistance at the $5 level and has faced a downward spiral since August 25. The previous week, $DOT appeared poised for a potential recovery as it approached the $5 mark. However, the rally fizzled out, leaving buyers disappointed and sellers regaining control, which led to a 3.21% drop on Sunday.
Monday’s session further exacerbated the situation, with $DOT falling by 5.39%, dipping below the 20-day Simple Moving Average (SMA) and closing at $4.56. The bearish sentiment persisted into Tuesday, as sellers attempted to drive the price below the $4.20 support level. Although buyers managed to prevent a deeper decline, $DOT ended the day at $4.38, marking a 4% drop.
Struggling to Maintain Support
The downward momentum continued through Wednesday, resulting in a 2.74% decline. On Thursday, strong demand at lower levels briefly buoyed the price, pushing $DOT to a daily high of $4.40. However, the gains were short-lived, with $DOT closing at $4.25 as demand at higher levels stalled.
Friday saw $DOT testing its support again, with sellers driving the price down to a low of $4.10. Despite a slight recovery to $4.29, a 0.94% daily increase, the overall sentiment remained bearish. A marginal decline on Saturday left $DOT at $4.25, maintaining its position just above the crucial $4.20 support.
What’s Next for $DOT?
The market sentiment surrounding $DOT is currently uncertain. If bullish momentum returns and buyers manage to keep the price above $4.20, there is a potential for $DOT to push towards $4.50 and possibly revisit the $5 level. Conversely, if bearish sentiment prevails, $DOT may continue to struggle. The price is currently at $4.18, reflecting a 2.50% decline, and if sellers maintain control, $DOT could slide towards $4.
In the event of a breach below the $4 level, a further decline towards $3.60—a multi-year support level—could be on the horizon. However, increased demand at these lower levels may spur a relief rally if buyers step in.
As the situation evolves, investors should stay alert to market signals and support levels to navigate the potential volatility ahead for Polkadot.
