Following the breakout on lower timeframes, Polkadot is consolidating in a falling wedge pattern on the daily timeframe.
Polkadot [DOT] broke through the $5.0 price level but was immediately rejected. This price action on the 4-hour timeframe highlights DOT’s struggle at this critical resistance point.
The $2.5 to $4 range is a psychological level that acts as both daily and weekly resistance. The DOT/USDT pair is currently rising within a parallel channel.
At press time, DOT is up 10.54% on the week. Despite the appearance of a bearish engulfing candle, signaling a possible reversal, the overall market sentiment towards altcoins remains bullish.
Falling Wedge Pattern
Additionally, DOT is consolidating within a falling wedge pattern on the daily timeframe, a structure that often signals a potential bullish reversal.
The price action in the DOT/USDT pair appears to have bottomed and could be preparing for a bullish breakout.
The next key level to watch is the upper trendline of this falling wedge, which will most likely be successfully retested before prices rise further, especially with the alt season expected in Q4 2024.
Weekly Support and Stochastic RSI
Polkadot’s [DOT] weekly support has remained strong, marking the lowest point for DOT. This support has stopped the price from falling five times, with the price falling back to this support after making higher highs.
The Stochastic RSI for DOT/USDT is currently in oversold conditions, suggesting that this week’s rally could be the start of a larger trend.
This expected upward trend could be influenced by the expected interest rate cuts, which would benefit altcoins such as DOT.
