Key Insights
- Polkadot price has received continuous selling pressure since December.
- DOT price has displayed U-tern recovery.
Polkadot (DOT) price has experienced a massive sell-off since December and has lost many support levels.
Amid this bearish trend, the momentum has halted in the demand zone and has displayed the beginning of U-turn recovery. DOT recently gained bullish momentum and has touched the 20-day EMA.
Polkadot Price in Demand Zone: What’s Next?
When writing, DOT crypto was trading at $5.17 which has declined by 1.34% over the past 24 hours. Its market value was $8 Billion and the 24-hour trading volume was $418.02 Million.
The DOT price has continued to drop, showing lower highs and lower lows. The price has recently accelerated and hit the lower-high region.
Sellers may recover if the price creates any bearish candlesticks in this area. This U-turn could lead to strong buying pressure.
On the other hand, buyers may be active if the price is able to maintain above the $4 major support zone. Strong bullish momentum is expected if the price breaks above the 200-day EMA.
The bullish forecasts are demonstrated by the bullish crossover that the RSI has shown with the RSI-based moving average.
Spot Inflow/Outflow Ratio Analysis
After three days of positive net inflows, DOT Spot Inflow/Outflow showed a significant change in market dynamics, with the Netflow going negative at -$2.60 Million as of February 12, 2025. The price of $5.205 is in line with this recent negative netflow.
In the past, times of positive net inflows were typically associated with price increases or stabilizations.
A recovery was bolstered by DOT’s increased inflows around early September and late October, indicating buying interest that momentarily raised prices.
On the other hand, periods of net outflows, which were prominent in late November and early December, showed a strong correlation with drops in DOT’s price, suggesting that selling pressure or profit-taking caused price levels to drop.
If the trend sustains, the return to negative netflow may indicate a resurgence of selling pressure or a decline in buying interest, which could result in a drop in DOT’s price.
A return to positive netflows could indicate incoming buying pressure and a potential price increase, while a continuation of this negative netflow could push prices lower.
DOT Price Analysis Amid this Downtrend
Polkadot is currently navigating a challenging market environment characterized by a significant sell-off since December.
However, the recent U-turn recovery in the demand zone could signal a potential reversal in momentum if the price remains above the crucial support level of $4.
The interaction with the 200-day EMA will be crucial; breaking above this level may set the stage for stronger bullish activity.
The Spot Inflow/Outflow analysis indicates a shift in market dynamics, with recent negative netflows suggesting increased selling pressure.
If this trend continues, it could lead to further declines in DOT’s price. Conversely, a resurgence in positive netflows may foster buying interest and support a price recovery.
Overall, while the near-term outlook is uncertain, monitoring these key levels and market dynamics will be critical for determining Polkadot’s next moves.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
