Polkadot Shows Bearish Signal, Analyst Predicts Drawdown To This Target
26 Dicembre 2023 - 1:00AM
NEWSBTC
A cryptocurrency analyst has explained how Polkadot could
potentially see a decline to this level because of a sell signal in
in its weekly price chart. Polkadot Weekly Price Has Formed A TD
Sequential Sell Setup Recently In a new post on X, analyst Ali has
pointed out that a TD Sequential sell signal has been forming for
Polkadot recently. The “TD Sequential” refers to a tool in
technical analysis that’s generally used for pinpointing likely
points of reversal in any asset’s price. The indicator is made up
of two phases. In the first phase, called the setup, candles of the
same polarity are counted up to 9. After the ninth candle, a
probable reversal in the price may be assumed to have taken place.
Related Reading: Dogecoin In Demand: Data Shows DOGE Adoption Is
Accelerating If the setup’s completion occurred with the overall
trend being towards the up (that is, the nine candles were green),
the asset might have hit a top. Similarly, a bottom could be in if
the price had been going down. The second phase, known as the
“countdown,” begins right after the setup’s completion and lasts
for thirteen candles. At the end of these thirteen candles, another
probable reversal in the asset could be assumed to have occurred.
Recently, Polkadot’s weekly price has completed a TD Sequential
phase of the former type, as the chart below shared by the analyst
shows. Looks like the cryptocurrency has seen nine green candles in
this setup | Source: @ali_charts on X As is apparent from the
graph, the Polkadot weekly price has finished the TD Sequential
setup phase with green candles recently. This could suggest that a
sell signal has now formed for the cryptocurrency. In the same
chart, Ali has also displayed the data for the 100-day exponential
moving average (EMA) for the asset, a level that has been a source
of resistance in the past. Interestingly, this TD Sequential setup
has completed just as the weekly price of the cryptocurrency has
approached the 100-day EMA. “This could lead to a spike in
profit-taking, potentially driving DOT down to $7.50,” explains the
analyst. From the current spot price, a drawdown to this level
would mean a drop of more than 18% for Polkadot. DOT Is Up Almost
3% During The Last 24 Hours While these bearish developments have
occurred in the weekly price of DOT, the asset has still continued
to rise during the past day, as its price has now cleared the $9.2
level. Related Reading: Bitcoin Whales Do $2.2 Billion Selloff, But
BTC Stays Strong Below is a chart that shows how Polkadot has
performed during the past month. The price of the asset seems to
have shot up during this period | Source: DOTUSD on TradingView The
green returns during the last 24 hours are a continuation of the
bullish momentum that DOT has enjoyed in the past week, a window
inside which it’s now up almost 39%. Though the asset has been able
to continue this run for now, the technical obstacles it’s facing
in terms of the TD Sequential and 100-day EMA could mean that the
top might be near for the coin. Featured image from Traxer on
Unsplash.com, charts from TradingView.com
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