Polkadot (DOT) price hit a high of $5.90 this week but has declined slightly since then.

The decline took DOT back below the $5.50 horizontal resistance area.

Polkadot drops after rejection

DOT weekly time frame analysis shows that the price has fallen below a descending resistance line since February, hitting a low of $3.56 in October.

This decline led to a break below a key horizontal support zone, in place since the beginning of the year.

However, a positive change occurred four weeks after the low. In October, Polkadot price broke above a descending resistance line, reaching a high of $5.90 last week, marking a 200-day high.

Although this increase appeared to have produced a break above the key resistance zone, DOT fell below this level shortly after. This creates a bearish candlestick (red symbol).

DOT/USDT Weekly Chart | Source: TradingView

Traders use the Relative Strength Index (RSI) as a momentum gauge to gauge market conditions, helping them determine a good time to buy or sell an asset.

An RSI above 50, combined with an uptrend, signals a favorable position for bulls. An index below 50 shows the opposite.

The RSI index is on an upward trajectory and is above the 50 threshold.

DOT Price Prediction: Is This the Start of a Bullish Reversal?

Technical analysts use Elliott Wave theory to confirm long-term, repetitive price patterns and gain insight into investor psychology, aiding in determining the direction of trends.

According to the current wave count, Polkadot price has completed a 5-wave downtrend (white) since reaching its all-time high in November.

If this analysis is correct, it suggests the start of a new movement in the opposite direction. This could signal the start of a new uptrend or an upward correction. However, both scenarios predict a significant increase in DOT prices.

The weekly RSI shows a bullish divergence since the beginning of the year (green line), further supporting the ongoing bullish momentum. Such divergences often occur at the bottom of a trend, signaling an uptrend reversal.

The importance of this bullish divergence is highlighted by its association with the retracement to the $4.40 area and the completion of the five-wave downward movement.

In case the DOT price continues to rise, the next level of resistance is found at $10. This zone corresponds to a 110% increase from the current price level.

DOT/USDT Weekly Chart | Source: TradingView

However, despite this bullish prediction, failure to reclaim the $5.50 horizontal resistance area could send the price down 15% to the nearest horizontal support at $4.40.

https://tapchibitcoin.io/gia-polkadot-dot-co-tang-len-muc-cao-moi-day-la-nhung-gi-phe-bo-can-lam.html