Polkadot (DOT) is on the brink of a potential breakout as it tests the pivotal $5.30 resistance level. After recording a 10% surge in daily gains and a 19% spike in trading volume, the altcoin is attracting attention from traders eyeing a bullish breakout. At the time of writing, DOT is trading around $5.26, just below this critical level, leaving the market eagerly awaiting its next move.
$5.30 Resistance: A Make-or-Break Zone for DOT
The $5.30 price point has emerged as a psychological and technical battleground for Polkadot. A decisive push above this level could open the door for a broader rally, potentially aiming for the $8.00 resistance. In a more optimistic scenario, further momentum could drive the price toward $11.67. However, if DOT fails to breach this level convincingly, it risks a pullback to the $4.70 support or even a retest of the $4.00–$4.30 accumulation zone, where the asset previously consolidated.
Bullish Indicators Signal Momentum — But for How Long?
Technical indicators suggest that DOT might have more upside potential. The Moving Average Convergence Divergence (MACD) flipped bullish after the MACD line crossed above the signal line. This crossover, coupled with growing histogram bars, indicates increased buying pressure. Additionally, the asset has broken out of a prolonged base accumulation phase, a signal that typically precedes a strong bullish trend. Yet, much depends on whether Polkadot can hold above the $5.30 resistance with substantial volume. Without it, the current rally risks turning into a fakeout—a temporary breakout that reverses sharply.
Liquidation Heatmap and On-Chain Activity: Key Metrics to Watch
One key metric to watch is Polkadot’s liquidation heatmap, revealing dense clusters of long positions at 25x and 50x leverage between the $4.54 and $5.09 range. While the market remains skewed toward bullish positions, the high leverage could backfire if the price dips below $5.09, potentially triggering a cascade of liquidations that could drive DOT back down to $4.80 or lower.
Moreover, the number of Active Addresses has declined to 62,100, signaling waning on-chain participation. This decline in user engagement could limit the sustainability of DOT’s rally, as lower network activity often correlates with reduced buying pressure.
Also Read: Polkadot Price Analysis: Will DOT Break the $5.30 Barrier or Face a Bearish Reversal?
Conclusion: Eyes on the $5.30 Resistance
For Polkadot, the next few trading sessions are crucial. A confirmed close above $5.30, supported by strong volume and ongoing investor interest, could validate the bullish outlook and pave the way for higher price levels. However, a failure to break through—or a liquidation-driven reversal—could stall the current uptrend. Traders should stay vigilant as market sentiment remains on a knife’s edge, with DOT’s immediate future hanging in the balance.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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