Polkadot (DOT) is correcting gains from the $7.5 resistance level against the US dollar. The price could start another rise if it remains above the $6.75 support level.
- DOT gained pace and tested the $7.5 resistance level against the US dollar.
- The price is trading above the $7.00 area and the 100 simple moving average (4-hours).
- There is a short-term expanding triangle forming with resistance at $7.50 on the 4-hours chart of the DOT/USD pair (data source from Kraken).
- The pair may continue to decline if it fails to stay above the support level of $6.75.
Polkadot price holds support
After forming a base above the $6.00 level, DOT price started to rise nicely. It broke several hurdles near $6.75 and even rose above $7.25. The high was formed at $7.46 and the price is now correcting gains, like Ethereum and Bitcoin.
There was a move below the $7.25 support area. The price fell below the 23.6% Fibonacci retracement level of the upward move from the swing low of $6.03 to the swing high of $7.46.
DOT is now trading above the $7.00 area and the 100 simple moving average (4-hours). Immediate resistance is located near the $7.25 level. The next major resistance is near $7.50. There is also a short-term expanding triangle forming with resistance at $7.50 on the 4-hours chart of the DOT/USD pair.
source: DOTUSD on TradingView.com
A successful break above $7.50 could start another strong rally. In the mentioned case, the price could easily rise towards $8.00 in the near term. The next major resistance appears near the $8.80 area.
More cons at DOT?
If DOT price fails to start a new increase above $7.25, it may continue to move lower. The first major support is near the $7.00 level and the 100 simple moving average (4-hours).
The next major support is near the $6.75 level or the 50% Fibonacci retracement level of the upward move from the swing low of $6.03 to the swing high of $7.46, below which the price could fall to $6.50. Any further losses might open the doors for a move towards the $6.10 or $6.00 support area.
Technical indicators
MACD on 4-hour chart – The MACD indicator 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.
Key Support Levels – $7.00, $6.75, and $6.50.
Major resistance levels – $7.25, $7.50, and $8.00.
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