• Polkadot [DOT] tested the $5 area as support again after facing rejection at $5.5 resistance.
• The ADX indicator showed a strong trend in progress, and the +DI and -DI crossovers showed bullishness from 27 May to 31 May.
• The sentiment was strongly bearish on 1 June, with Open Interest surging higher when prices dipped to $5.17.
Polkadot Tests the $5 Territory Again
Polkadot [DOT] faced rejection at the lower timeframe resistance at $5.5, and neared the $5 support yet again. At the time of writing, Bitcoin [BTC] traded at $27k after bulls defended the $26.8k mark in an extended skirmish over 36 hours while Ethereum [ETH] held onto its support area.
Rangebound Price Action and Indicators
Since 8 May, Polkadot has been trading within a range from $5.18 to $5.5 with mid-range value serving as support/resistance levels. Furthermore, on higher timeframe charts it was observed that DOT had traded between the $5.17 and $7 levels since March making the mid-range values even more credible ranges for DOT prices to remain in between .The ADX (yellow) on DMI indicator had been above 20 mark showing a strong trend but DOT price action indicated otherwise as it remained rangebound between both extremes of aforementioned ranges .The resolution of this seeming disagreement came through observing +DI and -DI values along with their crossovers which showed bullish momentum taking charge from 27th may 2021 till 31st may 2021 .At present ,the RSI remains below 50 though + DI crossed above – DI yet again showing an uptrend needing session close above 533 USDT for confirmation of said uptrend .
Sentiment Turns Sour
The sentiment turned sour on 1 June as prices continued to dip from 525 USDT to 517 USDT resulting in open interest surging higher indicating bearish market structure which could only be reversed by session close above 533 USDT as mentioned earlier .
Conclusion
Given that Polkdot is trading near important support level around 5 USDT , there is potential for bulls to take control pushing prices upwards if they manage to defend this key support zone along with crossing certain technical indicators such as RSI & Open interest levels but these developments have yet to be seen & need further observation before any conclusion can be reached regarding future movement of DOT price action .
Disclaimer:
The information presented does not constitute financial, investment, trading or other types of advice and is solely readers‘ opinion only