Disclaimer: The findings of the following analysis are the only opinions of the writer and should not be considered investment advice
Polkadot climbed past $17.5 on the charts and flipped to support before moving towards $19, but buying pressure seemed to be missing from the near-term outlook. Bitcoin was trading just above $39k, and the short-term direction of the king of crypto on the charts wasn’t too clear either. Weekends are also times of lower liquidity. Will Polkadot’s rally push it past $19 or was selling pressure likely dominant?
In the past week, Polkadot traded in a range of $16.17 to $17.57. This midpoint of this range was $16.87 and had some concurrence with a longer-term support level of $16.81. In recent days, DOT has found some support at this confluence of support levels.
In its first attempt at a break past the range highs, DOT was unable to hold onto the range highs after $17.6 flipped to support. Bitcoin saw a drop to $38.8k from $42k and DOT was also forced lower.
On its second attempt, the price was able to reach a higher (short term) high and also find demand at $17.6 meaning the short term market structure was bullish.
To the north, the $19 area offered significant resistance to the bulls’ efforts. Therefore, a buying opportunity could arise in the near term if this level is reversed to support. In the south, the $17.6 should remain unbroken for DOT to climb higher. A session that closes below $17.6 could cause DOT to fall back towards $16.2.
The RSI stood at 62.16 and has seen strong bullish momentum in recent hours. However, it also exhibited a bearish divergence between price and momentum. The Awesome Oscillator also appeared to be peaking lower even as the price moved higher.
In addition, the OBV showed that purchase volume was not particularly high after the $17.6 retest.
The indicators showed that Polkadot could see a pullback towards the $17.6 region in the coming hours. $19 formed a strong resistance and can be used as a take profit level. A move back below $17.6 in the coming days would likely revisit $16.8 and $16.2. A move above $19 and retesting as a support would also present a buying opportunity in the near term.