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- DOT caused a price turnaround after a recent price drop to $3.6.
- DOT demand improved, but financing rates were negative.
Dot [DOT] extended third-quarter losses into fourth-quarter 2023 as bearish pressure continued. In October, DOT lost more than 15%, falling from $4.3 to $3.6. However, after Bitcoin [BTC] recovering from recent losses, the altcoin staged a price reversal.
Read Polka dots [DOT] Price forecast 2023-24
Since mid-July, sellers have overwhelmed the DOT market. AMBCrypto’s previous price analysis of the token leans toward additional losses if bearish pressure continues.
But the mid-October reversal attempt to $3.6 could lead DOT to target the resistance hurdle.
The roadblock at the $4 psychological level
Source: DOT/USDT on TradingView
A Fibonacci retracement tool was plotted between the low of $4.8 on August 29th and the recent dip of $3.6 on October 12th. The Fib tool showed that the recent DOT reversal faced obstacles from above, namely 23.6% Fib ($3.9) and 38.2% Fib ($4).
The second resistance target at $4 doubled as a daily bearish order block (OB). The confluence led to the conclusion that the level could pose more challenges for bulls if DOT prices breach $3.9.
Meanwhile, spot market demand improved slightly, as evidenced by the rebound in OBV. Moreover, buying pressure recovered, as illustrated by the rise in the RSI, but remained below the 50-point threshold, confirming a strong bullish reversal.
However, DOT recorded limited capital inflows, as evidenced by CMF’s southward movement.
Demand recovered, but financing rates were negative
Source: Coinalyse
Since October 8, DOT Open Interest (OI) rates have improved from $156 million to $169 million at the time of writing. It meant that demand for DOT in the derivatives segment recovered in recent days.
How many Worth 1,10,100 DOT today?
The reversal gave the bulls a slight lead over the market again, as evidenced by the increase in the CVD (Cumulative Volume Delta).
The two positive indicators are a bullish scenario for DOT. But the higher timeframe market structure bias was negative unless DOT rose above $4. And negative financing rates could complicate bullish efforts.