Polkadot: Is the rhythm of DOT traders going long right?

although polka dot [DOT] July ended strongly, and early August was the opposite. On the last day of last month, DOT rallied from $8.2 to $9.11 – a lucrative profit for its short-term investors.

However, since August 1, DOT has reversed to a downward trajectory and has lost about 9.64% of the previous day’s value.DOT is priced at $7.83 at press time Coin market value.

Long road ahead?

Looking at the chart, DOT has been holding the $8 support level after dropping to $8.63 and $8.15. However, the coin lost control of the zone after selling pressure overwhelmed it.

Losing this support could end DOT traders’ hopes of going long.

Well, that might not be the case either, since DOT isn’t losing one important July support area.

Source: TradingView

The bearish state of DOT was further confirmed as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) showed their respective positions.

According to the chart, the RSI is already close to oversold levels. However, it has remained at a good level in favor of DOT sellers.

At press time, it was below the midpoint of 41.95. Likewise, the MACD established bearish DOT sentiment as the strength indicator for sellers (orange) rose above buyers (blue).

While some traders may want to see a bullish signal, DOT has other plans. This is because the selling pressure is increasing as DOT indicates flatter lows and lower highs. On the chart, the descending triangle may prove that DOT’s current bearish momentum is very high.

expected drop

According to Santiment data, the state of DOT may continue to be in favor shorts. Trading volume has decreased by 35.94% in the past 24 hours. As of August 1, the figure was $1.01 billion. At the time of writing, it has dropped to $666.85 million.

Source: Santiment

Likewise, a shrinking market cap does not mean that traders want to go long. Notably, the market cap fell from $8.91 billion to $81.2 billion.

However, it may be too early for bears to rejoice in control. This is because the Exponential Moving Average (EMA) did not follow the MACD and RSI forecasts. The 20 EMA (blue) is solidly above the 50 EMA (yellow), indicating that the continued price decline may not last long.

The next 24 hours could be critical for DOT. If DOT falls further, it may be the wrong time to go long. However, the EMA indicator suggests that a reversal of bullish momentum is also possible.

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