Polkadot consolidates before new all-time highs – FXStreet

Jonathan Morgan Jonathan Morgan
Independent Analyst

Polkadot price shows that it may not experience a steep retracement if there is a pullback in the cryptocurrency market. A pullback is still likely, but the move would be within the recently traded price action range. Therefore, Polkadot may be positioning for a breakout earlier than the rest of the market, continuing its behavior as a cryptocurrency market leader.
Polkadot price has an uncommon kind of behavior to it. It recently had sizable gaps between the close and the Tenkan-Sen, indicating that strong near-term pullbacks were likely to occur. Instead, Polkadot has traded sideways, and the least expected reaction to Tenkan-Sen and price gaps has occurred: the Tenkan-Sen rose to equilibrium with Polkadot. This means that less time is needed and that Polkadot should expect less volatility to begin its next swing higher.
How long will traders need to wait until Polkadot price can continue its bull run? Perhaps not as long as one would think. The Relative Strength Index is in neutral territory, so it can sustain any bullish breakout. Likewise, the Composite Index is at a neutral level but crossing below both of its averages – that could warn of some selling pressure soon. Finally, the Optex Bands are at extremes and are just now moving lower from those extreme overbought conditions.

DOT/USD Daily Ichimoku Chart
Buyers may want to wait until there is a close above the 61.8% Fibonacci expansion at $57.64. Any move to that level over the next week would likely position Polkadot’s oscillators back into overbought conditions. In addition, hodlers will want to be careful of any drop below the Kijun-Sen at $46 over the next week. A close below the Kijun-Sen could trigger intense selling pressure, especially if that close occurs between today and Friday. Because the Optex Bands are just coming off extreme overbought levels and the Composite Index is crossing below its moving averages at a neutral level, any close at or below $46 could trigger a selloff.
 
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Bitcoin price is lost in no man’s land after crashing below $22,000 on August 26. This sell-off was followed by a tight consolidation that led to another nosedive that has pushed BTC below its support trend line. 
Dogecoin (DOGE) price is seeing bulls kicking back into gear as the dust settles in the aftermath of Jackson Hole. Investors are coming back and picking up trades at lucrative discounts.
Solana price is embracing the return of stability several days after the cryptocurrency market flipped bearishly. The largest cryptocurrency, Bitcoin, plunged below $20,000 on Friday and pulled the entire market down with it. 
Ethereum funding rates are similar to the level observed in July 2021, ahead of a massive rally in Bitcoin and ETH. The funding rate – the difference between the perpetual contract prices and short prices of an asset – is a key metric to predict crypto trend reversals. 
Bitcoin price shows a tight consolidation on a lower time frame – an ascending parallel channel – that repeats the motif of three larger channels that have developed on higher time frames since the start of 2022. 
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.
Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.
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