Polkadot (DOT) Faces Bearish Market Structure Break and Potential Price Drop

One sentence summary – Polkadot (DOT) has experienced a bearish market structure break, losing support at $4.3, with the 1-day chart indicating a reversal in order blocks from bullish to bearish, suggesting a possibility of reaching sub-$4 prices in Q4 2023, supported by the recent increase in Open Interest and downtrend in spot CVD.

At a glance

  • Polkadot experienced a bullish market structure break on the lower timeframe.
  • The subsequent bounce lost momentum and fell below the crucial support level of $4.3.
  • The drop indicated intent from sellers.
  • The next higher timeframe support zone remains uncertain.
  • The Fibonacci extension levels suggest a possibility of reaching sub-$4 prices in Q4 2023.

The details

Polkadot (DOT) recently experienced a bullish market structure break on the lower timeframe.

However, the subsequent bounce lost momentum and fell below the crucial support level of $4.3.

This drop indicated intent from sellers.

The next higher timeframe support zone remains uncertain at the moment.

Analyzing the 1-day chart

Polkadot stood at $4.28 with a lower high at $4.56.

This level was initially surpassed but unable to sustain the upward move.

Notably, the $4.27 level represented the low of the bullish order block on the 1-day chart.

Unfortunately, DOT closed a daily session below it.

This effectively flipped the order block to a bearish breaker.

Considering the Fibonacci extension levels

It suggests that there is a strong possibility of Polkadot reaching sub-$4 prices during Q4 2023.

The specific levels to watch for are $3.894, $3.495, and $3.317.

On August 31, when DOT dropped from $4.45 to $4.26, the Open Interest increased significantly.

This surge in Open Interest indicates intense short-term bearish sentiment surrounding Polkadot.

Additionally, the spot CVD (Cumulative Volume Delta) has been consistently showing a downtrend.

This indicates continued selling pressure and the absence of strong buyers.

This situation suggests a potential further drop in price for Polkadot.

Based on the available information, Polkadot (DOT) has experienced a bearish market structure break, losing support at $4.3.

The 1-day chart indicates a reversal in order blocks from bullish to bearish.

The Fibonacci extension levels suggest a possibility of reaching sub-$4 prices in Q4 2023.

The recent increase in Open Interest and the downtrend in spot CVD further support the short-term bearish sentiment for Polkadot.

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– Polkadot (DOT) experienced a bullish market structure break on the lower timeframe, but the bounce lost momentum and fell below the $4.3 support.
The drop below $4.3 indicated intent from sellers and the next higher timeframe support zone is uncertain.
On the 1-day chart, Polkadot stood at $4.28, with a lower high at $4.56 that was beaten but unable to sustain the move.
The $4.27 level represented the low of the bullish order block on the 1-day chart, but DOT closed a daily session below it, flipping the order block to a bearish breaker.
– The Fibonacci extension levels suggest that sub-$4 prices are a strong possibility for Polkadot in Q4 2023, with levels at $3.894, $3.495, and $3.317.
On August 31, when DOT dropped from $4.45 to $4.26, the Open Interest increased, indicating intense short-term bearishness.
The spot CVD has been in a downtrend, showing continued selling pressure and the absence of strong buyers, suggesting a potential drop in price for Polkadot.

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