polkadot

Polkadot (DOT) has been facing resistance and struggling to gain momentum. Investors are watching closely, wondering if the price will continue to fall or make a comeback. In this article, we’ll dive into the recent price movements, factors impacting DOT, and what might happen next.

Polkadot (DOT) Recent Price Movements

As of today, Polkadot (DOT) is trading at $4.12, with a 24-hour trading volume of $261.49 million. Its market cap is $6.18 billion, and it holds 0.29% market dominance. Over the past 24 hours, DOT has seen a slight decline of 1.87%.

The token hit its all-time high of $54.98 in November 2021 and its lowest value of $2.82 in August 2020. Since then, the lowest DOT price was $3.59, and it managed a rebound to $11.86 before settling into its current range. Market sentiment around Polkadot is bearish, with the Fear & Greed Index showing a neutral reading of 50.

Polkadot has a circulating supply of 1.50 billion tokens, with a supply inflation rate of 51.85% over the last year, adding 512.08 million new DOT to the market.

Why Is Polkadot (DOT) Price Down?

Polkadot’s price struggles stem from both technical factors and market conditions. Despite a 25% increase in on-chain activity since May 2023, DOT has been unable to break through the $5 resistance level.

Currently, the token is bouncing between $4 support and $5 resistance. Strong selling pressure is keeping the price below $5, but buyers have stepped in at the $4 level to prevent further drops. If DOT breaks below $4, it could fall to its multi-year support at $3.62. However, if buyers push the price above $5, it could trigger an upward move.

While user engagement is a positive sign for Polkadot’s ecosystem, it hasn’t translated into higher prices, suggesting a disconnect between network activity and market sentiment.

Will Polkadot (DOT) Price Crash to Zero?

Polkadot is unlikely to crash to zero. Despite being down 92% from its all-time high, DOT has shown resilience. Over the past year, DOT has risen 1%, outperforming its token sale price. Additionally, it has had 16 green days in the past 30 days, indicating positive movement for more than half the month.

DOT’s high liquidity relative to its market cap helps maintain stability, allowing for easy buying and selling without drastic price fluctuations. While the token has lagged behind major players like Bitcoin and Ethereum, it still outperforms 74% of the top 100 crypto assets.

Can Polkadot (DOT) Rise Again?

DOT’s path forward depends on breaking key resistance levels. If the token surpasses $5, we could see stronger bullish momentum. However, if the $4 support fails, the price could drop to $3.62. The yearly inflation rate of 51.85% could also put downward pressure on the price if demand doesn’t keep pace with supply.

Despite these challenges, Polkadot’s strong ecosystem and increased user activity suggest that a full collapse to zero is unlikely. External factors like market conditions and broader trends in the crypto world will play a major role in determining Polkadot’s future price movements.

Several altcoins, including Polkadot (DOT), have recently seen their gains evaporate due to rising geopolitical tensions. Over the past three days, DOT’s price fell by over 14%, dropping to $4.04. In times of market turbulence like this, it’s essential to evaluate key fundamentals and sentiment among traders.

Polkadot On-Chain Metrics: User Growth and Activity

Despite the price drop, Polkadot’s on-chain activity offers some positive signs. One crucial metric is the number of daily active users and new accounts. Since May of last year, the number of new accounts has remained steady, while active users have increased by more than 25%. This indicates that more people are using the network regularly.

Additionally, the amount of DOT transferred daily has also surged, showing that larger volumes are moving through the Polkadot ecosystem. This heightened activity could be a positive indicator for the network’s future growth.

Is Polkadot Ready for a Breakout?

According to several market analyses, DOT may be nearing the end of its accumulation phase. The token is reportedly approaching a long-standing falling wedge pattern, a bullish technical indicator that could signal an upcoming breakout.

Analysts have set key resistance levels at $11.83, $18.41, $26.30, and $37.53, which DOT could target once it breaks out of this phase. Market observers like “Lucky” also see this trend, predicting that DOT could soon “take off” as it exits its accumulation phase.

Could Polkadot Surge to $200 by 2025?

In a more bullish scenario, TradingShot, an investment firm, has drawn comparisons between Polkadot’s price cycle and Ethereum Classic’s (ETC) 2018-2021 trajectory. Both assets display nearly identical RSI sequences on a one-week chart, suggesting Polkadot may be following a similar pattern.

If this pattern holds, Polkadot could potentially rally toward the 1.5 Fibonacci extension, which would place its price around $200 by the end of 2025. While this prediction may seem extreme, it highlights the long-term potential some see in DOT based on historic market behavior.