Disclaimer: The information presented does not constitute financial, investment, trading or any other advice and is solely the opinion of the author
- DOT bulls lost control after retesting the June high of $5.5.
- Spot CVD fell, but Open Interest rates stabilized.
Dot [DOT] sellers have consolidated their control since price rejection at the June high near $5.5. A short trip above the June high was a hunt for liquidity as DOT reached $5.64 on July 3 before entering a pullback.
Read Polka dots [DOT] Price prediction 2023-24
At the time of writing, the price of DOT was $5,022, below its March low and former support of $5.2. Another price rejection at the March lows further bolstered sellers’ leverage, forcing them to focus on the $4.8 support for additional gains.
In terms of development, a new version – Polka dot 2.0 seen in recent talks, but the story hasn’t changed DOT’s price trend at the time of writing.
Will the immediate support hold?
Source: DOT/USDT on TradingView
The impressive recovery from June ran into a problem retesting the June high. The price rejection caused DOT to reverse some of its recent gains and lose more than 10% after falling from $5.64 on July 3 to $5.02 at the time of writing.
The decline turned the March low and May support of $5.2 into resistance. So far, bulls have failed to win back, giving sellers more advantage to seek profit at the next support level – $4.87. While a liquidity hunt above $4.8 cannot be overruled, bulls could try to secure support.
So a $4.87 rebound and a confirmed uptrend could be a buy signal, especially if BTC won’t drop below $30k. In that case, the immediate target will be $5.2, while the June high will be a secondary target.
Conversely, a BTC dropping below $30,000 could push DOT into a further aggressive sell-off. A $4.3 retest could be feasible if bulls fail to hold the $4.87 support.
The RSI failed to move above the neutral position, while the OBV hovered above -80 million, indicating that demand has eased in recent days.
Open Interest rates stabilized
Source: Coinalyse
On the 1-hour chart on Coinalyze, a crypto derivative data tracking platform, the Open Interest (OI) fell but then stabilized. At the time of writing, OI rose to $131 million from $127 million.
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However, the declining cumulative volume delta has stabilized over the past few days, meaning selling pressure has eased. Taken together, the stats could point to a possible price reversal and likely recovery at $4.87 support.
But BTC’s jaunt to $29,000 could also crack support. Thus, bulls must wait for a confirmed uptrend and a BTC price above $30,000 before seeking entry again.