Polkadot is one of the most innovative and ambitious projects in the cryptocurrency space. It aims to create a network of interoperable blockchains that can communicate and exchange value with each other without relying on a central authority. Polkadot also offers scalability, security, and governance features that make it a powerful platform for building decentralized applications.
Recently, Polkadot has been testing the $5 territory as support, after reaching a new all-time high of $55 in November 2021. The price of DOT, the native token of Polkadot, has been fluctuating between $5 and $6 for the past month, showing resilience amid market volatility. Some analysts believe that Polkadot is poised for a breakout in 2023, as it prepares to launch its parachain auctions and enable cross-chain functionality.
Polkadot Numbers Could Still Remain Positive
Since May 8, Polkadot has been trading within a narrow range (white) between $5.18 and $5.5, with a midpoint at $5.34. This range has been tested several times as support and resistance, confirming its validity.
However, this range is not only a short-term phenomenon but also a reflection of a longer-term consolidation pattern. On higher timeframes, it can be seen that DOT has been fluctuating between $5.17 and $7 since March.
Therefore, the $5.15 level is not just a temporary support, but also a significant historical support that dates back to early March.
The market mood was pessimistic on 1 June. As DOT prices dropped further from $5.25 to $5.17, the Open Interest increased sharply. It rose from $151 million to $157 million, which indicated that a few short sellers were keen to enter the market.
Polkadot is a project that has the potential to revolutionize the cryptocurrency industry and beyond. It is creating a new paradigm for blockchain interoperability, scalability, and governance that could unlock new levels of innovation and collaboration in the web3 space. As Polkadot continues to develop and grow its ecosystem, it could become one of the most dominant and influential platforms in the crypto market.
