Polkadot (DOT) – Medium-term outlook at risk of deteriorating dramatically

Polkadot (DOT) – Medium-term outlook at risk of deteriorating dramatically

Posted on Wednesday, July 13 2022 at 9:09 pm GMT+0000

Polkadot (DOT) sellers finally managed to push through the bottom line of the three-week-old consolidation pattern at 6.35, rekindling the medium-term negative bearing.

The falling Ichimoku lines are endorsing persisting negative forces and the momentum indicators are skewed to the downside. The CCI is diving below -100 and the ROC is falling below its zero line, raising the stakes for additional bearish action in the forthcoming sessions.

Therefore, if sellers remain in the driver’s seat, they could soon challenge the 161.8% Fibonacci extension level of June up-leg at 4.85. Another leg lower from here will likely reach the 227.2% Fibonacci extension level of 3.27.

On the flip side, if buyers manage to make a remarkable comeback and step beyond the Ichimoku lines at 6.75 and 7.24 respectively, tough resistance could transpire around the 8.10 – 8.77 area linking the Ichimoku cloud and the most recent high. By overrunning that region, bulls may catapult the price to challenge the May 30th peak of 10.83.

All in all, Polkadot’s medium-term outlook is currently at risk of deteriorating dramatically, after the recent drop below 6.35. Yet the bearish breakout is still at an early stage and only a significant daily close below the aforementioned level could confirm a sharp sell-off.