Polkadot Price Analysis: DOT Soars As Crucial Support Level Holds Once More

Polkadot (DOT) has been experiencing choppy waters over the past month, with sellers pushing the price as low as $6.41. However, despite the bearish sentiment, DOT’s support level of $6.40 has held strong. 

Polkadot (DOT) has rebounded once again over the past few days as buyers took control of the market and pushed the price above $7. 

Polkadot (DOT) Has Strong Week 

The Polkadot (DOT) price has had a strong week after dropping dangerously close to its support level of $6.40, with many anticipating strong bearish momentum had sellers managed to push the price lower. DOT had been sandwiched between the 200-day SMA and the 20-day SMA at the beginning of the month. However, selling pressure intensified on Friday (May 10), pushing the price below $7 and the 20-day SMA to $6.64. The drop came after a period of sideways consolidation but was not surprising given DOT had been hovering between $6.40 and $7.50 for a while now. However, DOT’s support level has held on four different occasions, and sellers have been unable to push the price below this level.

The same happened this week, as can be seen in the price chart after DOT fell to $6.63 on Sunday. The current week began with a highly volatile session that saw DOT go as high as $6.83 and as low as $6.41. However, it was able to recover and settle at $6.67. Bearish sentiment returned on Tuesday as sellers took control and pushed DOT down by almost 3% to $6.48. However, as it has done in the past, DOT made a strong recovery from this level, surging by 7.41% to go past the 20-day SMA, which was acting as resistance and settled at $6.96. 

Thursday saw DOT cross the significant $7 mark, settling at $7.03, while another strong showing on Friday saw the price rise even higher, settling at $7.20. The current session sees DOT still at $7.20, with buyers and sellers looking to exert control. 

Where Does Polkadot (DOT) Go From Here?

As you can see from the price chart, there is strong support at $6.40, which is the lower end of DOT’s trading range. The price currently sits at $7.19. Should bullish sentiment remain, we could see DOT rise to $7.40, where the 200-day SMA could act as a resistance level. Should DOT be able to move past this level, a rally to $8 could be a probable scenario in the short term. However, should sellers regain control, we could see DOT repeat its previous pattern and drop to $7, where the 20-day SMA could act as support. Should this level be breached, DOT could drop back toward $6.40

Looking at the technical indicators, we can see that the MACD is currently bullish, indicating that DOT could continue its upward momentum, at least in the short term. Another indicator of the prevailing positive sentiment for DOT is the Parabolic SAR, which is also bullish, as seen in the chart above. 

Polkadot Sees Record-Breaking User Engagement 

There is a lot else happening on Polkadot besides its price, which is making a strong recovery during the current week. User engagement and activity on Polkadot have hit record levels, with active addresses hitting an all-time high for the second month in a row. Data sourced from DotLake shows the network hit 650,000 active addresses by the end of April. This is significantly more than the network’s previous high, reached only a month earlier in March. 

“New heights for activity on Polkadot! In case you missed it, April marked a new ATH for monthly active accounts since the start of ’22, when parachains first launched.”

The rise in active addresses can primarily be attributed to Moonbeam.

Meanwhile, the Founder Institute announced it had entered into a strategic partnership with Polkadot to pioneer the first-ever Web3 cohort within its Core Program.

“We are thrilled to announce a groundbreaking collaboration between the Founder Institute (FI) and the Polkadot ecosystem. This collaboration marks the beginning of an exciting chapter as we launch the very first Web3 cohort in the Founder Institute’s Core Program. Our cooperation is set to revolutionize the landscape of startup acceleration and Web3 technology education.”

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Credit: Source link