Polkadot (DOT) registered a substantial decline of almost 6% on Thursday as sellers dragged the price below $4, as bearish sentiment returned to the broader crypto market.
Polkadot (DOT) has struggled to build momentum and push above crucial resistance levels since failing to go above $4.60 on October 20.
Polkadot (DOT)’s Mixed Week
Polkadot (DOT) has been in positive territory since the weekend but has fallen back over the past couple of sessions after failing to push above the 20-day SMA. DOT declined substantially last Friday (October 25), falling over 5% to a low of $3.84 before settling at $3.99, just below its support level of $4. With strong demand at this level, DOT recovered on Saturday, pushing above $4 and settling at $4.03 after an increase of 1%. Bullish sentiment intensified on Sunday as DOT rose by 2.48% and settled at $4.13.
Source: TradingView
The week began with DOT facing significant volatility as buyers and sellers struggled to take control. As a result, DOT plummeted to an intra-day low of $4 and rose to an intra-day high of $4.22 before dropping and settling back at $4.13. Buyers took the initiative on Tuesday as DOT rose by 1.45% and moved to $4.19. They also attempted to push above the 20-day SMA as DOT reached an intra-day high of $4.25 before losing momentum and dropping back. Wednesday saw DOT face considerable selling pressure as it fell to a low of $4.12. However, it recovered from this level to register a marginal increase and settle at $4.20.
A Substantial Decline
As we can see in the price chart, Polkadot (DOT) has been struggling to push above the 20-day SMA, which acted as a dynamic level of resistance. As a result of the growing selling pressure at this level, DOT fell back into the red on Thursday, dropping almost 6% to slip below $4 to hit a low of $3.90 before settling at $3.96. DOT dropped to a low of $3.88 during the current session before recovering as sellers maintained control. Currently, DOT is marginally down and trading at $3.94 as buyers look to push the price back above $4.
Future Price Action
With the broader markets turning bearish on Thursday, a decline in the DOT price was expected. DOT has strong support at $4, and with buyers entering the market, we should see DOT reclaim $4 and push back towards $4.20 and the 20-day SMA. However, whether buyers can build momentum and move towards $4.50 remains to be seen. On the other hand, if sellers retain control and push DOT lower, we could see a drop to its multi-year support of $3.62 before a reversal.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
