Key Support level: $48
Key Resistance level: $54; $71
Polkadot managed to push above $50, breaking its all-time high, and looks primed to head higher.
The structure mentioned in our weekly analysis has broken to the upside, and DOT is now into price discovery. Currently, the price is retesting the breakout, and if it successfully holds above the key support at $48 (which was resistance) then DOT can enter into a steep rally towards $54 and $71.
Chart by TradingView
Trading Volume: Major volume on the breakout. This gives confidence and strength to the current price action. If the volume remains high, continuation becomes very likely.
RSI: The RSI has not broken above 70 points on the daily timeframe, indicating that there is a lot of room left for bulls to take DOT higher. This could be the start of a major rally as DOT enters price discovery.
MACD: The histogram and the moving averages have turned bullish on this breakout on the daily timeframe. This is an important bullish sign that indicates DOT may remain on the positive side for some time before a correction takes place.
Chart by TradingView
DOT is very bullish right now. Any break above the all-time high is a strong sign the market participants are ready to pay more to hold a given cryptocurrency. DOT just signaled to the market that is it might be undervalued and can enter a rally until a new balance is found between the bulls and bears.
DOT may remain around $50 in the nearby future. However, if the current retest of resistance turned support at $48 is successful, then DOT is a great candidate for a sustained rally that can take its price to $70 and beyond in the coming weeks. Yet, remain vigilant as the upcoming weeks are likely to be very volatile.
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