Polkadot (DOT) is showing bearish signs below the $8 resistance against the US dollar. The price could extend the decline if it does not remain above $6.00.
- DOT is gaining pace below the USD 8.80 and USD 8.00 levels against the US dollar.
- The price is trading below the $7.20 zone and the 100 simple moving average (4 hours).
- A major bearish trendline is forming with resistance at $6.50 on the 4-hour chart of the DOT/USD pair (Kraken data source).
- The pair could continue to decline towards the $5.00 support zone.
Polkadot price resumes decline
After a steady rise, DOT price faced resistance near the $7.60 zone. It formed a short-term top and started a new decline below the $7.00 level, just like Ethereum and Bitcoin.
There was a move below the $6.20 support zone. A low was formed near $6.03 and the price is now consolidating losses. It is slowly moving higher from the $6.35 level and the 23.6% Fib retracement level of the downward move from the $7.58 swing high to the $6.03 low.
DOT is now trading below the $7.00 zone and the 100 simple moving average (4 hours). The immediate resistance is near the $6.50 level. There is also a major bearish trendline forming with resistance at $6.50 on the 4-hour chart of the DOT/USD pair.
Source: DOTUSD on TradingView.com
The next major resistance is near $7.00 or the 61.8% Fib retracement level of the downward move from the $7.58 swing high to the $6.03 low. A successful break above $7.00 could herald another strong rally. In the mentioned case, the price could easily rise to $8.20 in the short term. The next major resistance is seen near the $10.00 zone.
More disadvantages in DOT?
If the DOT price fails to start a new increase above $7.00, it could continue to decline. The first major support is near the $6.00 level.
The next major support is near the USD 5.65 level, below which the price could drop to USD 5.00. Any further losses could perhaps open the doors for a move towards the $4.20 support zone or the trendline.
Technical indicators
4-hour MACD – The MACD for DOT/USD is now losing momentum in the bearish zone.
4-hour RSI (Relative Strength Index) – The RSI for DOT/USD is now below the 50 level.
Major support levels – USD 6.00, USD 5.65 and USD 5.00.
Major resistance levels – $6.50, $7.00 and $8.50.