- Polkadot (DOT) is nearing a crucial resistance at $3.82, and a successful breakout could trigger a strong rally toward $4.78, supported by bullish technical signals and rising investor interest.
- However, failure to break this level may lead to a pullback to $3.27, delaying any major upward move.
Polkadot (DOT) is approaching a critical turning point as it flirts with a crucial resistance level at $3.82. After bouncing back from a descending wedge formation—a pattern often associated with bullish reversals—DOT is now trading near $3.66, up nearly 5% in the last 24 hours. All eyes are now on whether it can decisively break above this key threshold.
Momentum Shifts in Favor of Bulls
Technical indicators are beginning to align in support of a potential breakout. On the 4-hour chart, DOT has printed a TD Sequential buy signal, often viewed as a precursor to trend reversals. The price is also brushing against the upper boundary of the descending wedge, which typically acts as a launchpad for upward movements.
Adding to the bullish setup is a crossover between the 9-day and 21-day moving averages, currently hovering around $3.61. This early bullish signal is supported by a strengthening trend on the Directional Movement Index (DMI). Although the negative directional index (-DI) remains above the positive (+DI), the gap is narrowing—indicating that selling pressure is waning and buyers are gradually gaining control.
Derivatives and Exchange Data Support Breakout Case
In the derivatives market, the Long/Short Ratio stands at 1.0137, showing a slight bullish tilt with over 50% of traders holding long positions. More interestingly, data from Coinglass reveals a cluster of short liquidations between $3.70 and $3.83. A breakout through this zone could trigger a chain reaction of forced buybacks by short sellers, accelerating DOT’s move toward the $4.78 mark.
Meanwhile, activity on spot exchanges adds further fuel to the bullish narrative. On April 17, DOT saw $4.56 million in outflows compared to $4.42 million in inflows—a sign that investors are withdrawing their holdings from exchanges, typically a bullish signal indicating accumulation rather than intent to sell.
$3.82: The Gateway to Higher Highs
The $3.82 resistance is the battleground where DOT’s immediate future will be decided. A clean break and sustained movement above this level could attract fresh buyers and even activate trading algorithms, propelling DOT toward the $4.78 resistance zone.
However, if bulls fail to conquer this level, the price could retreat to $3.27, keeping it within the wedge structure and delaying any significant rally. Still, the broader setup remains promising.
With bullish technical patterns, favorable market sentiment, and strong exchange data, Polkadot is set for a potential surge—if it can clear the $3.82 barrier.
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