Cryptocurrency

Polkadot’s divergence sees DOT slip back beneath this support level

Disclaimer: The findings of the next evaluation are the only opinions of the author and shouldn’t be thought of funding recommendation.

Polkadot has been on the next timeframe downtrend. This downtrend started in early April. Before that, the time interval from November to late February additionally noticed Polkadot submit heavy, constant losses. In March, a rally was seen, however this rally didn’t provoke a longer-term uptrend.

Bitcoin additionally struggled to carry on to the psychological $20k mark. A deeper dip may ship DOT plunging down the charts as properly.

DOT- 12-Hour Chart

Source: DOT/USDT on TradingView

In April and May, wave after wave of relentless promoting stress noticed Polkadot drop from the $23 resistance level, all the best way to the $7.44 support. In May, the value was in a position to declare the $9 space as support, however couldn’t push previous the $10.5 resistance.

The second week of June noticed Bitcoin slip beneath the $28k space, and Polkadot additionally misplaced the $9 support zone. The $7.5 and $6.4 ranges have acted as support up to now two weeks.

As DOT bounced to retest the $9 zone of former demand, a hidden bearish divergence (orange) between worth and momentum (RSI) was seen. Following this growth, the value dropped back under the $8 mark.

Rationale

A divergence on Polkadot sees the asset slip back beneath support, can bulls steady the ship?

Source: DOT/USDT on TradingView

The RSI has tried to rise back above the impartial 50 line up to now two weeks. Each of the three makes an attempt took the RSI increased. At the identical time, the value shaped decrease highs and signaled a hidden bearish divergence on two events up to now week.

The most up-to-date one noticed DOT submit losses of almost 15%. Moreover, the event of the hidden bearish divergence instructed that the downtrend could possibly be set to proceed.

The OBV was additionally struggling to push above the collection of almost equal highs it set in current weeks. This failure hinted at a scarcity of shopping for energy. Even although the CMF has been above +0.05 up to now week, it won’t sign a development reversal.

Conclusion

If the CMF falls back beneath the -0.05 mark, it could add proof to the already bearish outlook that Polkadot has on the charts. The indicators confirmed that momentum was back in favor of the sellers, and the OBV confirmed that the patrons lacked energy. Another transfer to $6.4-$6.5 could possibly be shut.

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