The past weekend was broadly bearish for cryptocurrencies, the most important of which remain under pressure on Monday, but there are as always glaring exceptions. This was notably the case with the Polkadot, which took off last night and last night, ending last week’s flash crash canceling out.
The Polkadot indeed parked a high at $ 38 very early this Monday morning, a threshold that had not been visited since May 19. Note that this increase has also allowed the Polkadot to pass Dogecoin in the ranking of the most important cryptocurrencies, currently occupying the 8th position. Note also that the DOT follows a powerful upward trend since its low at $ 10.37 on July 20. Since then, in less than 2 months, Polkadot has exploded by more than 260%.
In this analysis, we will focus on the reasons for the rebound following last week’s crash, and then assess whether to buy Polkadot cryptocurrency, from a graphical point of view.
The news supports and justifies the rise of the Polkadot
Several developments have indeed aroused investor enthusiasm about the Polkadot in recent days.
Notably, PolkaBridge’s multi-blockchain automated market maker that is currently running on the Ethereum blockchain plans to integrate Polkadot soon.
PolkaBridge presents itself as a decentralized financial application platform that can be used to exchange tokens on the DOT platform to other blockchains.
In addition, it should be noted that the 6th Parachain auction was won on September 8 by the KILT protocol, which works on the issuance of verifiable, revocable and anonymous certificates to end users.
With projects like KILT that rely on Parachains, activity on the DOT blockchain is likely to be boosted, a prospect that justifies the Polkadot price hike.
The winners of the first five Parachain auctions include Ethereum Virtual Machine (EVM) compatible projects that offer a range of decentralized financial applications, providing liquidity and staking rewards. Once the Parachain auctions are over, and the parallel blockchains are started by Polkadot, there is a good chance for the demand, and therefore the price of DOT will increase.
Polkadot Technical Analysis: Buying Opportunity?
From a graphic point of view, it should be noted that the price of the Polkadot has retreated from its peaks last night. However, the pullback is by no means sufficient to call into question the uptrend visible on the daily chart.
Thus, from a tactical point of view, the decline observed on Monday can easily be seen as a buying opportunity for those who missed the rise in the Polkadot last weekend.
When it comes to where to go, the May 15 all-time high just below the psychological threshold of $ 50 will be the first big target. On the downside, a return below the 200-day moving average at $ 27.75 can be viewed as a reversal of the uptrend. It is therefore an ideal threshold for positioning a protection stop.
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