January 28, 2023

  • Polkadot (DOT) could drop to USD 4,376.
  • A rise above $4,695 invalidates the prediction.

Polkadot (DOT) has been in a downward trend since mid-August. From its August high of $9.6, it dropped to $4.5 at the time of publication. That’s about a 50% drop in value, and it looks like it could break through another level of support.

DOT has been trading sideways for the past five days, fluctuating between $4,695 and $4,376, but it could fall below that range if the $4,376 support does not hold.


Read Polka Dot (DOT) price prediction 2023-24


$4,486 Support: Can It Hold Up?

Source: DOT/USDT on TradingView

Polkadot’s downtrend since mid-August has formed a multi-month descending channel. It has broken several support levels. Based on technical indicators, it could break another one before the Christmas weekend.

In particular, the RSI recovered slightly from the oversold territory, but moved sideways. It suggests that buying pressure increased, but sellers resisted equally, resulting in a neutral market. Nevertheless, the RSI was at 32, deep in the lower range, indicating that sellers still have the upper hand.

On-balance volume (OBV) has also fallen steadily since November. Therefore, DOT could continue to trade within the current sideways structure or fall below it. If sellers have the upper hand, the price could break the current support at USD 4,486 and reach USD 4,376.

Such a downward move could help investors sell high and buy back cheap when DOT hits $4,376. However, this possibility comes with an unattractive risk-reward (RR) ratio.


How lots of Polka Dot (DOT) can you get for $1?


A break above the upper limit of the trading range at $4,695 would invalidate the above bearish bias. However, DOT bulls will need to overcome the immediate $4,602 bearish order block to move above the upper range boundary.

The upward movement allows DOT to focus on the EMA Ribbon level at $4,923.

Investor prospects remained negative, despite the recent increase in development activity

Source: Sentiment

The DOT’s weighted sentiment remained negative for most of December. At the time of publication, it slipped even deeper into negative territory. This suggests that investors remained extremely pessimistic about the asset.

Interestingly, the steady increase in development activity did not push the DOT price up until around December 13-15, when sentiment improved slightly. Could the recent negative sentiment and increasing development activity cancel out the positive outlook for DOT’s price?

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