Polkadot (DOT) price gains traction as it forms a double falling wedge pattern. This formation...

Polkadot (DOT) price has gained traction following the development of a double falling wedge pattern on the technical chart. This formation signaled renewed momentum in its price movement.

Polkadot price has gained traction following the development of a double falling wedge pattern on the technical chart. This formation signals renewed momentum in its price movement.

Recently, DOT has bounced from a key support level of $3.72, where analysts and traders are looking for a breakout. If this pattern continues, it could push the Polkadot price toward a price target of $10.

Double Falling Wedge Pattern Signals a Technical Setup

The latest chart showed two falling wedge patterns. These are often seen as signs of a possible trend reversal to the upside. In earlier cases, the price increased when DOT reached the bottom of these patterns, leading to a rally.

These points were highlighted with green arrows on the chart. The current price of $3.72 is considered a key support level where Polkadot price could start forming a higher low.

Traders have noted that the trend is close to flipping bullish. If confirmed, this would bolster technical support to continue the upward movement.

If the DOT token breaks above the upper trendline of the wedge, it is likely to rise significantly. Historical performance suggests the potential for a move up to $10.

That funding rate chart has also shifted. Funding rates were now closer to neutral or slightly positive, showing less negative pressure. This means short positions have decreased. This may allow long positions to strengthen further.

Polkadot’s market capitalization grew by more than $400 million in a day as demand for it grew. This was due to recent developments and price recovery. Polkadot is poised to crack the Top 15 altcoins by market capitalization as interest grows and new use cases emerge.

Funding Rate and Price Relationship Reflect Market Shift

The chart analyzing DOT’s Open Interest (OI)-Weighted Funding Rate over time, alongside its price, provides insights into trading patterns. This correlation highlighted key behaviors necessary for informed trading decisions.

The green and red bars indicated funding rates, with green showing positive funding and red showing negative funding. Green bars mean long traders pay shorts, while red bars show the opposite, usually when short interest rises.

The funding rate has often fallen into the red over the past months, precisely when prices were falling. Usually, this is a bearish signal. Despite continued negative funding into March and early April, Polkadot price has recently stabilized and begun to recover.

When the price rises while funding remains negative or neutral, it may indicate a contrarian bullish setup. Traders interpret this as an early indication of a potential trend reversal. This is likely if DOT price remains above the $3.50-$3.80 range and funding shifts back to positive.

Fundamental Developments Support Price Recovery

Polkadot price and project narrative have received much support in recent developments. Harbour announced a $100 Million investment in the Polkadot ecosystem, the first sign of institutional interest.

In addition, DOT tokens will soon move toward a zero-inflation model, resulting in a smaller supply over time. DePIN technology is also being adopted through Polkadot.

The Peaq network, developed on Polkadot, is driving significant growth worldwide. This progress stems from a rising demand for decentralized infrastructure.

Polkadot network is also increasing in the Web3 gaming space. Mythical Games is leading the development efforts of these types of projects and is aiding in building a new gaming ecosystem.

The Hub network will soon see many launches, such as JAM, testnet, and mainnet rollout. These upcoming milestones will add more utility and functionality to the network.

On the moonbeam chain, the team is continuously progressing cross-chain capabilities for communication between different blockchain platforms. At the same time, GIGADOT contributes to promoting DeFi opportunities in the Polkadot ecosystem.

Major brands have collaborated with Polkadot, reinforcing its growth strategy. These partnerships enhance its presence in both crypto and mainstream markets.

However, data from derivatives markets indicates a growing level of trader interest in Polkadot contracts.

The total open interest across exchanges was over $185 Million, with perpetual contracts accounting for more than $183 Million. The 24-hour open interest has grown by over 3.39%, while futures contracts alone increased by over 10%.

In this article, the views, and opinions stated by the author, or any people named are for informational purposes only, and they don’t constitute the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.

Olivia Stephanie is a FinTech enthusiast with a keen understanding of financial markets. Her passion for economics and finance has led her to explore emerging blockchain technology and cryptocurrency markets.