Key Takeaways:
- DOT price is likely forming a massive double-bottom pattern near $4.20.
- A crucial bearish trend line forms with resistance near $4.70 on the daily chart.
- A close above $4.70 and $5.00 could start a fresh rally toward the $8.00 level.
NEW DELHI (CoinChapter.com) — Polkadot’s DOT found support near $4.20 and is currently attempting a recovery wave. The price could surge if it stays above $4.20 in the medium term.
Polkadot’s DOT Price Could Start Fresh Rally
After a major decline, DOT price found support near the $4.20 zone against the US Dollar. The price formed a base above the $4.20 level and recently started a recovery wave, like Bitcoin and Ethereum.
More importantly, the price will likely form a double-bottom pattern near $4.20. The daily chart clearly suggests that the $4.20-$4.30 support region is the key and might kick-start a strong increase soon.
DOT price recovered above the 23.6% Fib retracement level of the downward move from the $5.70 swing high to the $4.20 low. However, it is still well below the $5.00 pivot level and the 50-day simple moving average (blue).
On the upside, immediate resistance is near the $4.65 level. A crucial bearish trend line is forming with resistance near $4.70 on the daily chart.
A close above the $4.20 resistance could send the price toward the $5.0 pivot zone and the 50-day simple moving average (blue). It is near the 50% Fib retracement level of the downward move from the $5.70 swing high to the $4.20 low.
A successful daily close above the $5.0 resistance could start a strong increase in DOT. The price may test the $5.70 resistance or $6.20 in the stated case. Any more gains might open the doors for a move toward the $8.00 level (a possible double-bottom pattern target).
Another Decline?
If there is no push above $4.70 or $5.00, the DOT price might start a fresh decline. Initial support is near the $4.40 level. The main breakdown support sits near the $4.20 level.
A close below $4.20 may start a drop toward the $3.85 support zone. Any more losses could set the pace for a test of the $3.50 support zone in the coming days.
Overall, the DOT price may form a bottom and start a strong increase above the $4.70 and $5.00 resistance zone. Conversely, there might be a fresh decline to $4.20 or even $3.85.
