DottedPrice action is starting to indicate a potential shift in momentum, with a reversal setup forming below the critical $2.85 level. The bulls are gradually increasing pressure, looking for a breakout that could confirm a change in trend. However, the presence of strong resistance means that the upcoming sessions will be crucial in determining whether DOT can break free or face another pushback.
The DOT downtrend is showing signs of exhaustion as buyers look for a short-term recovery
give a Follow up On the expected track of DOT on the 4-hour time frame, Elliott Waves Academy revealed that the series of declines across the sub-waves of the recent impulsive move may be coming to an end. This suggests that the current downtrend is exhausting itself, at least in the short term, with a recovery likely in the future.
Related Reading: Polkadot’s recovery stalls as bearish pressure returns with $3.5 seen on the horizon
Elliott Waves Academy notes that a diagonal pattern appears to be forming, which outlines the complex details of wave (1)/(A). This diagonal formation is key to analysis, because it usually signals the termination of the previous trend and precedes a reversal.
The analyst indicates a confirmed breach above the upper limit of this diagonal pattern. Such a breakout would officially open the way for a bullish recovery towards the area between $3.3423 and $3.36538.
On the other hand, the $2.2848 level is crucial to maintain immediate recovery expectations. Elliott Waves Academy warned that if this critical $2.2848 level is broken, further significant declines are expected through an extension of the current bearish waves.
Polkadot remains trapped below key HTF resistance levels
Encryption functions subscriber On the The analyst cautioned traders to remain conservative with any (long) swing setups while the price trades below these critical resistance barriers.
Examining the current price action, Crypto_Jobs described market conditions as neutral, with Polkadot fluctuating within a narrow range between $2,500 and $2,700. The sideways movement reflects the lack of a clear direction, with both bulls and bears struggling for dominance. Despite this period of indecision, the chart is displaying an emerging pattern that may soon determine the next significant move.
The cryptocurrency analyst noted the possibility of an inverse head and shoulders pattern forming, with a neckline around the $2,700-$2,850 to $3.00 area. A confirmed break above this neckline could signal renewed bullish momentum, which could send prices up 5-10%.
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