$DOT Massive Long Liquidation Hits.
The market took a dramatic turn as Polkadot ($DOT) faced a significant long liquidation worth $6.2365K at the price level of $6.624. Traders who were overly optimistic and held leveraged long positions got caught in the storm as prices dropped, triggering forced liquidations.
What does this mean.
1. Long Liquidation: This happens when the price drops below a trader's liquidation price in a leveraged long position, causing the position to be forcibly closed.
2. Market Impact: Liquidations often increase volatility, adding fuel to the price movement in the direction of the liquidation.
$DOT Current Scenario.
Support Zone: Look out for strong support near $6.50 to $6.40. If the price holds here, a bounce-back is possible.
Resistance Levels: The immediate resistance lies at $6.70 and $6.85.
Potential Trend: If selling pressure continues, we could see $DOT testing lower levels near $6.30. However, recovery above $6.65 could reignite bullish momentum.
Action Plan for Traders.
Short-Term Strategy:
Buy Zone: $6.35 to $6.45
Target Levels: $6.70, $6.85, and $7.00
Stop-Loss: $6.20
Risk Reminder: Always manage leverage carefully to avoid falling into the liquidation trap like the $6.2365K long positions.
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