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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- DOT was trading just below the $5.5 level, but an increase could still be expected.
- The quick recovery after the dip to $5 was an encouraging factor for buyers.
Dot [DOT] has made huge gains in recent weeks as the altcoin market started to heat up. However, the social metrics for the token were disappointing. Development activity remained high and gave investors confidence.
DOT technical analysis showed that despite the volatility over the past two days, the bulls were still in control. A critical level of resistance remained, but sellers weakened.
The pullback was only $5 before another bounce followed
Source: DOT/USDT on TradingView
The daily market structure remained firmly bullish. The RSI was at 67 to reinforce the idea that the bulls were in control. On-Balance Volume shot above February highs, underscoring the intense buying pressure of recent weeks.
The Chaikin Money Flow (CMF) also meant massive capital inflows into the DOT markets.
The $5.3-$5.56 region has been a bearish order block on the one-day chart since late May. DOT managed to close a daily trading session above it on November 12, breaking it as a resistance zone. The subsequent pullback reached $5 but saw a sharp jump very quickly.
The Fibonacci retracement levels of $4.73 or lower are untested. This was another sign that buyers were dominant and market conditions favored shallow pullbacks at this time. To the north, the $6.2 and $7.05 levels were likely to be tested next.
Are we on track to conquer the $5 region again?
Source: Hyblok
AMBCrypto’s analysis of Hyblock data revealed that another decline to the $4.9-$5 region would not be surprising. Whether it comes before a move to the $6 region or after remains to be seen.
Read Polka dots [DOT] Price prediction 2023-24
The last seven days’ liquidation data shows that $5 and $6 remain the areas of interest.
A move to $6.2 would be a sign that $7 would be next. Traders will need to be wary of volatility as a large portion of liquidations could end up just above $6.