Can stagnant sales be an indication of an impending bearish market for DOT? This question seems to be at the forefront of many investors’ minds, especially given the recent performance of DOT. The cryptocurrency has been unable to maintain a crucial short-term support level of $4.32, leading to speculation that the market may soon be dominated by sellers, or ‘bears’. As selling stagnates bears abound, it’s crucial for investors to keep a close eye on the market trends.
DOT’s Struggles in the Market
Polkadot [DOT] ended the month of August in a sea of red, with a loss of over 16% in its monthly performance. The third quarter of the year does not seem promising for DOT bulls, with July also showing mixed results and an overall 1% loss. While Bitcoin [BTC] managed to retest the $28k level on 29th August, it was unable to maintain the gains, struggling to hold on to $26k as of press time.
Breaking Down the Support Level
During mid-August, DOT experienced a significant price drop which was temporarily halted at the $4.32 short-term support. This support level, steady since June, coincided with the weekly bullish order block (OB) of $4.22 – $4.59. The weekly bullish OB had previously prevented a price dump in June, and a similar trend could boost the bulls. However, sellers are likely to wait for a break below this area before extending gains to the $4.0 support.
Market Control and Future Predictions
With the reversal of BTC to $26k, a narrow price range over the weekend seems likely. As a result, DOT could consolidate its losses below the $4.32 support over the weekend. On the other hand, if bulls manage to regain short-term market control, the dynamic resistance level, 50-EMA (Exponential Moving Average), and the H4 bullish OB near $4.6 could be key targets. The RSI has retreated to the oversold zone, while CMF has moved southwards below zero, reinforcing an extreme short-term bearish bias on the spot market.
Furthermore, the CVD (Cumulative Volume Delta) dropped from 30th August but stabilized at press time. This suggests that while sellers had absolute market control, buyers have since counteracted their influence. This lack of leverage for both buyers and sellers calls for caution in the market.
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