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Cryptocurrency News Articles
Polkadot (DOT) Struggles to Gain Momentum Amid Broader Market Uncertainties, Risks Further Downside
Oct 11, 2024 at 06:00 pm
Polkadot (DOT) faced continuous rejection from the $4.1 resistance, while struggling to gain momentum amid broader market uncertainties.
Polkadot (DOT) faced continuous rejection from the $4.1 resistance, struggling to gain momentum amid broader market uncertainties. The recent downturn from this resistance put DOT at risk of further downside, especially as it hovered around key support levels.
DOT was trading at approximately $4.03 at press time, down by 1.3% over the last 24 hours.
DOT faced resistance at $4.1 as bulls failed to overcome EMA resistances, leading to a pullback
DOT recently faced resistance around the $4.1 level as bulls failed to overcome the EMA resistances. This triggered a pullback and DOT, at press time, traded below the 20-day and 50-day EMAs, both of which acted as immediate hurdles. As the near-term EMAs continued to trend south, the coin’s short-term biases depicted increasing selling pressure.
If DOT closes below the $3.9 support level, the coin could be exposed to further losses, potentially retesting the multi-year low range of $3.5-$3.6. A breakdown below this level could open the door for even deeper corrections.
However, if bulls managed to reclaim the EMAs, it could prevent a further decline and offer an opportunity for a near-term recovery. A retest of the $4.9 resistance level (above the 50-day EMA) could be possible in such a case.
MACD recently saw a bearish crossover, where the MACD line fell below the Signal line. This indicated that sellers had the upper hand at the time of writing. Similarly, the RSI also pointed towards a bearish edge. Buyers should wait for a close above the 50-mark before opening a long position.
Derivatives data revealed a slight bias towards short positions
The 24-hour long/short ratio was 0.8671 at press time and indicated a slight bias towards short positions. On Binance and OKX, however, the long/short ratios were massively skewed in favor of bulls—at 5.4599 and 3.6. This underlined huge optimism among top traders on these platforms.
It is also important to note that DOT’s trading volume also rose by over 31% over the past day. The slight uptick in Open Interest (+0.46%) also suggested that traders kept their positions open, despite the recent volatility.
Finally, the liquidation data revealed a higher number of long liquidations, which might imply profit-taking and caution among traders as DOT failed to sustain momentum above $4.1. It is crucial to consider Bitcoin’s movement and assess the overall market sentiment before opening any positions in the short term.
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