Polkadot’s price has traded and retested the $27 price level twice. On the second retest, the price of DOT is fluctuating below the $27 resistance zone. The price consolidates above the $26 support and retests the resistance level.
Traders believe that consolidation below a resistance level increases the chances of a breakout. Currently, a breakout is not possible as the altcoin is trading in overbought territory. The coin does not have enough room to move higher. Since August 7, DOT /USD has been trading in the overbought region. Today, the altcoin has reached $26.72 at the time of writing.
Polkadot indicator analysis
The cryptocurrency is at level 77 of the Relative Strength Index for period 14. The market is considered overbought, and in the overbought region there will be sellers pushing prices lower. DOT is above the 80% area of the daily stochastics. The daily stochastic also confirms the overbought condition of the market. The 21-day and 50-day SMAs are up, indicating an uptrend.
Major Resistance Levels – $48, $52, $56
Major Support Levels – $32, $28, $24
What is the next direction for Polkadot?
Polkadot’s upward movement was stopped below the high of $27. The cryptocurrency is now in a sideways movement. Meanwhile, on August 20 uptrend, a retraced candle body tested the 78.6% Fibonacci retracement level. The retracement suggests that the price of DOT will rise, but will reverse at the level of 1.272 Fibonacci extension or the level of $28.00.
Disclaimer. This analysis and forecast are the personal opinions of the author and are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their research before investing funds.