Polkadot is treading water and is about to sink another 10%
|- Polkadot price slides lower and says goodbye to vital support.
- DOT to trend lower as support is too far off for now.
- Expect DOT to head toward $5.30.
Polkadot (DOT) price is a bit of an outlier this Wednesday, while several other crypto and altcoins are showing a small turnaround with a bullish undertone. DOT is not showing any of that after bears breached the dams and flooded the area around $5.75. Price action quickly sank lower and is heading toward $5.30 with no real support to be found along the way.
Polkadot price is at risk of performing either a dead-cat bounce or receiving a topside rejection
Polkadot bulls have let DOT price action rotate too loosely of late with the result that DOT has sunk below $5.75. Meanwhile, in early Wednesday trading, bulls have been trying to pare back losses, and that is opening up their performance for another nudge lower. Bulls already briefly pushed the price back up above $5.75 before it then slipped back lower and showed signs of either being a dead-cat bounce or bulls having received a firm rejection on that same topside level at $5.75.
DOT will sink lower from here and has no real handles or circuit breakers nearby that could trigger a turnaround. Bears have an open road to head toward $5.30 and add another 10% to their short-selling trade. Even the Relative Strength Index (RSI) has room to go lower, so bulls will have to ride this one out and wait for $5.30 before attempting to trigger a turnaround.
DOT/USD 4H-chart
One big global event is set to take place later this Wednesday in the shape of the US Federal Reserve rate decision. After First Republic Bank had to be sold to JP Morgan, markets are focused on hearing from the Fed if this is the end of the line regarding rate hikes and tighter market conditions. If the Fed delivers a dovish message, expect a firm jump higher with DOT quickly back up at $6.25 and rallying 10% just on the back of the central bank’s statement tonight in the US trading session.
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