- Market sentiment around Polkadot turned bearish.
- Metrics revealed that selling pressure was rising on DOT.
As a seasoned analyst with years of observing market trends and fluctuations under my belt, I must say that the current state of Polkadot (DOT) is concerning, to say the least. The 10% plunge in just 24 hours is a stark reminder of how quickly the winds can change in this volatile crypto space.
Over the past day, the crypto market has shown a downturn, with many digital currencies experiencing price adjustments. Polkadot (DOT) was no different in this trend.
Indeed, DOT experienced the most significant setback compared to the other leading cryptocurrencies based on market cap. Consequently, AMBCrypto delved deeper into the situation to ascertain if a recovery for DOT is imminent in the near future.
Polkadot’s latest price correction
In the past day, Polkadot’s value dropped significantly, around 10%, while many other cryptocurrencies experienced minor setbacks.
Currently, the token is being traded at approximately $9.49, and its total market value exceeds $14.44 billion, positioning it as the 15th largest cryptocurrency in terms of market capitalization.
It turns out that DOT’s trading activity spiked by 15% over the past day, and this high volume seemed to contribute to the recent drop in its price.
The downward trajectory in the token’s price was also accompanied by a decrease in its social statistics, as indicated by Santiment’s data. This decline suggests a significant drop in the token’s influence on social media platforms, pointing towards reduced interest and popularity among users.
Moreover, Polkadot’s Weighted Sentiment dipped into the negative region, suggesting an increase in pessimism or bearishness towards the token within the market.
Can DOT recover soon?
After examining additional datasets, it was discovered that there might not be an immediate recovery from this downward trend for DOT, as selling activity among investors seemed to increase when DOT’s price began to fall.
According to Hyblock Capital’s findings, there were several instances over the past 24 hours where the volume of DOT sales increased significantly, peaking at a staggering 100 during one particular period.
Initially, a figure more akin to 100 indicated brisk trading was taking place within the market for that specific token, suggesting heightened demand.
In addition, the Funding Rate for Polkadot saw a minor decrease, according to information from Coinglass. A reduction in Funding Rates within cryptocurrencies usually means that short positions are growing more common.
This can be a sign of a bearish sentiment in the market.
Similar to the Sell Volume Indicator, the Relative Strength Index (RSI) presented a comparable pattern. The RSI showed a significant drop, suggesting an increase in selling pressure.
If the trend for DOT continues downwards, it may initially reach the support level provided by its 20-day Simple Moving Average (SMA), as hinted by the Bollinger Bands. At this point, there could be an opportunity for DOT to initiate a bullish surge and regain strength.
Notably, not only did Polkadot’s price drop, its network activity also followed a similar trend.
Read Polkadot’s [DOT] Price Prediction 2024-25
According to an analysis by AMBCrypto, it was observed that the number of daily active addresses and transactions for DOT have significantly decreased in recent days when compared to earlier periods.
It turned out that users weren’t frequently using the blockchain, a situation that could potentially lead to more complications for DOT.
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2024-12-10 06:16