Polkadot has not identified any price traction above $25.90 since the rebound from the May 23 low. The range of resistance levels defined by the 200-day SMA at prices of $23.57 and $25.90 may continue to stifle Polkadot bounces in the short term, encouraging investors to study opportunities from a long and short perspective.
Polkadot price will close in May with a 36% loss after falling over 70% from the May 15 high at a price of $50.74 to the May 23 low at $13.59. The volatility included a 60% collapse on May 19 before rebounding later in the day. The low price correction undercut the 78.6% Fibonacci retracement level of the 2021 rally at $14.89.
DOT price did rebound close to 100% from the May 23 low to the May 28 high at a price of $26.66 before falling below the 200-day SMA again. The strategically important moving average has played a role in DOT price for most of the days since May 23, establishing it as an essential determinant for the long-term direction of the digital asset.
Polkadot strength will likely be contained to the 200-day SMA until a credible base can be identified on a relevant timeframe. Based on the speed of the decline, Polkadot is combating elevated levels of price compression that need to be released before it can attract more committed investors.
If the Polkadot does overcome the moving average at a price of $23.57, it will quickly hit a superior resistance level at $25.90, a level just above the April 23 low at $25.82 and the February 23 low at $25.87. From May 26-28, Polkadot reversed near the price level, fortifying its importance in the narrative.
A daily close above $25.90 would encourage investors to consider higher resistance, beginning with the 38.2% Fibonacci retracement level at $27.78 and then the 50% retracement at $32.16. Ambitious investors will strike resistance level at the declining 50-day SMA at $34.05.
Since the Polkadot price is trading below a critical moving average, it is advisable to consider the downside. DOT price has few notable support levels, except for the May 30 low at a price of $18.39, representing a 20% decline, and then the May 24 low at a price of $16.94. Any weakness beyond those prices confirms the cryptocurrency still has not recorded a definitive correction low.
With the upside resistance level clearly defined and only minor support, there is a high probability that DOT price is exposed to further losses.
0 Comments