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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- DOT rose 7% from the recent dip of $3.9, but hit a low ($4.2).
- Buyers had market influence at the time of writing, but open interest was fluctuating.
Dot [DOT] swing traders who captured the trend change around September 12 were up 5% at the time of writing. The native parachain altcoin traded at $4.2, up from the recent dip of $3.9, but hit a low that could tempt sellers to re-enter the market.
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At the time of printing, Bitcoin [BTC] was above its low, but had not yet broken above the $27,000 midpoint before the September 20 FOMC meeting. With a Fed rate pause on the horizon, BTC could reclaim $27k and attempt to target the range-high of $28.3k.
Main obstacles for Polkadot
Source: DOT/USDT on TradingView
During the recent dip, the bulls regrouped at $3.9, marking an impressive recovery from September 12. However, the price action reached a low of $4.2 at the time of writing.
The Relative Strength Index (RSI) reached the overbought zone, indicating strong buying pressure over the past four days. But the foray into the overbought zone meant a potential turnaround could not be overruled.
On the other hand, the CMF also improved but failed to cross the zero line at press time. It showed that capital inflows improved, but were not substantial enough.
Thus, DOT could teeter at the low of $4.2 in the coming hours and fall further, especially if BTC is rejected at a mid-price of $27,000. The immediate support is the $4.1 level.
But the solid recovery extension above $27,000 by BTC could push DOT to convincingly reclaim the $4.2 low. If so, the next hurdle for DOT will be the mid-range that aligns with the daily bearish order block (OB) range of $4.2 – $4.3 (red).
Polkadot buyers influenced the market, but…
Source: Coinalyse
Spot buyers have had market leverage since September 12, as evidenced by the rising CVD (Cumulative Volume Delta).
How many Worth 1,10,100 DOT today?
Moreover, Open Interest rates have soared from September 10, indicating that the demand for DOT in the derivatives market has improved. But the numbers have faltered over the past three days, which could tip the balance in favor of sellers.
A negative Accumulative Swing Index (ASI), blue line, could signal a confirmed trend change and reversal at the low of $4.2. So if the metric breaks its trendline by easing to -4, it could indicate increasing seller advantage.