Polkadot is recognized as a unique PoS cryptocurrency that aims to provide interoperability with other Blockchains. According to many experts, it is one of the most valuable altcoin projects. At the time of writing, we answer some important questions of DOT, which is traded at $ 15.56, with the analysis of popular crypto analyst Benjamin Cowen…
The most important question for Polkadot (DOT), according to the analyst:
Cowen, who started his analysis by stating that he is “optimistic” about Polkadot’s future chances, warns against buying altcoins from their ATH, noting that most altcoin projects can (theoretically) offer higher returns from investments.
Continuing, the analyst, who states that DOT hit different exchanges in August 2020 and spent a lot of time in the accumulation phase, also reports that the DOT ATH, which took place a few months ago, decreased by 69%. Therefore, the most important question to ask, according to Cowen, is “at what point does it make sense to come back to stock up on a position?” is happening. The analyst, on the other hand, answers this question, “It’s really hard to tell anything just by looking at the DOT/USD chart.” However, there are some technical indicators to watch.
Benjamin Cowen: Using DOT/BTC chart makes sense
Cryptocoin. com, altcoins have a close relationship with Bitcoin as seen in the past. So using a DOT/BTC chart is the most logical move here, according to the analyst. Accordingly, looking at Bitcoin’s ongoing price trajectory, Cowen’s observation is as follows:
With BTC falling below the 20-week SMA, it makes things questionable and risky for the altcoin market.
Answering this question, “You assume the bottom is for BTC”, Cowen thinks that the sideways movement of BTC will also have a direct impact on the DOT, as stated in the chart above. In addition, recalling the May drop and Bitcoin’s correction, the analyst reports that DOT was affected during this period and moved with BTC. DOT accumulation or DCA at these levels continues to weigh on BTC regardless of the bottom.
Also, adding that Bitcoin has not made any updates or significant movements for 2 months, the analyst states that what has changed is that the DOT continues to lose strength despite the price hitting Bitcoin. However, there is a lot to be said about DOT based on the ETH chart.
According to the analyst, the performance of DOT against Ethereum is also important
Finally, commenting on the DOT/ETH pair, Cowen states that “in August 2020, then in January 2021 and then to the current level” (yellow line), he ends his analysis with the following sentence:
DOT/ETH has historically been near the bottom.