Polkadot in the last week has been subject to a serious contraction which, after the previous one from 50 to 45 dollars, has led the price to test the main short-term support area at 40 dollars, before the current recovery.
With the current decline, DOT has moved below the 55-day simple average, experiencing a slightly bearish phase that is common to several other cryptocurrencies these days.
At 6:55 pm this evening, Polkadot (DOT) is trading exactly at $ 41.660, down -0.69%. Currently, the cryptocurrency remains in eighth place by overall market capitalization according to CoinMarketCap, with trading volume down about -33% in the last 24 hours.
Polkadot Price Forecast: The Bearish View
It should always be borne in mind that the declines of the last week started after reaching the all-time high of $ 53.4, also achieved thanks to the start of the Parachain auctions. The current correction can be considered natural and should therefore not worry as long as the price remains above the support area of $ 40.
However, should the bearish trend extend below this value, for Polkadot the current correction could soon translate into a reversal that is certainly more painful for bullish traders.
Specifically, a drop below $ 40 could enable an extension of the downside to the next $ 37 support level, which would constitute a first monthly low.
Taking advantage of the technical gap behind this price level, further contractions of Polkadot (DOT) could bring the cryptocurrency even up to $ 30, effectively eroding the increases of the month of October 2021.
There is still hope for new hikes in the very short term
Assuming instead a recovery of the previous bullish scenario – and considering that in the very short term the view remains bullish, in a window between 40 and 50 dollars – Polkadot could first try to recover the 45 dollar area from which he took the collapse of the past few days has begun.
If this were to occur, a return to the level of 48 dollars (even already at the weekly close) could testify to the resumption of the upward trend, with the aim of recovering the highs above 50 dollars.
For a look at all of today’s economic events, check out our economic calendar. You can also follow our Facebook page to stay up to date on the latest economic news and technical analysis.