Bitcoin (BTC) has already taken significant strides this year, but altcoins are catching up. Once the price of bitcoin begins to stabilize, the market environment for altcoins will get better to begin their trend.
One of the best performers in 2021 is Polkadot as this cryptocurrency has hit new highs every day. Polkadot’s price rose 85% in 2021 and 75% in the last seven days, beating XRP’s market cap.
The DOT price is targeting $ 20 or more after this rally
Polkadot’s daily chart shows a rounded bottom construction in the final quarter of 2020. Since then, the support / resistance at the USD 4.55 level has changed significantly, creating another uptrend.
This continuation on the upside started with a massive rally to $ 10. Afterwards, the demand held for support (gray box) and new levels could be defined with the help of the Fibonacci expansion.
One of these regions was $ 14.25-14.75 and the second was $ 16-17, as the graph shows.
The main question right now is whether the DOT has ended its current trend. If that’s the case, Areas of interest for support / resistance changes are the Fibonacci values 0.35-0.382 and 0.618-0.65.
These Fibonacci numbers are often used to predict where such corrections will potentially reverse course. In Polkadot’s case, these are largely in line with previous levels of support or resistance, i.e. the USD 13 and USD 10.50 areas. This is where traders should keep an eye out for potential buying opportunities.
Again, Polkadot will most likely correct itself only if Bitcoin drops significantly. Otherwise, polkadot and many other altcoins are currently in a good position for further benefits.
However, If a correction occurs and Polkadot hits the bottom, new levels of interest can be set on the charts for the next momentum move. If so, Polkadot could continue its rally towards $ 23-24 and possibly even $ 32-35 later in the year.
DOT / BTC pair is approaching critical resistance zone
Polkadot’s daily chart for the BTC pair has shown a massive surge in the past few days. However, this surge is approaching a significant zone of resistance.
It is common sense and it goes without saying, but entering a trade correctly is not recommended as the price moves towards the resistance zone.
The Sats range of 0.00045000-0.00047000 is a critical area for progression as it would trigger another powerful push up. If this area collapses and seeks assistance, it will likely move on to pricing for polkadot.
However, the price will most likely not increase here. In this scenario, a healthy correction is possible by traders observing the 0.00035000 sats region but also the 0.00031500-0.00032250 zone.
The $ 15 support level is critical
The 2 hour chart is showing a strong uptrend but some critical levels must be maintained for this rally to continue.
In this perspective The previous high of $ 15 should provide support. If this range applies, Polkadot may rally again to $ 20 or more.
The failure to hold the $ 15 area as support and a significant correction are on the table. The next areas of support are $ 12 and $ 10.75-11.25, which is a correction of 30-40%..
However, Polkadot shows that with one of the biggest gains in 2021, it has plenty of potential for the next year.
The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and trade movement involves risk. You should do your own research when making a decision.