Assessing Polkadot’s 12-month low and the way forward for DOT
- DOT struggles to safe bullish momentum and we discover why.
- Polkadot dominance slides to 12-month lows however fee-paying transactions underscore life indicators.
Polkadot [DOT] has been in a downward spiral for the final 5 months. There have been varied bullish makes an attempt alongside the best way and indicators that the bulls would take over, just for worth to increase its draw back.
DOT traded at $4.14 at press time, which was roughly a 27% premium kind its August highs. Extra importantly, the cryptocurrency kicked off this week with bullish expectations after flashing a bullish RSI divergence in the previous couple of weeks.
Supply: TradingView
Though it could nonetheless be too early to evaluate DOT’s latest tried upside, the cryptocurrency seems to be experiencing the identical drawback this week. Demand for DOT has been fairly low regardless of its latest upside, therefore its wrestle to bounce again.
Why DOT has been struggling to discover a bullish footing
Many of the high performing cryptocurrencies are aligned with key narratives which have prevailed over the previous couple of months. The Polkadot community did not capitalize on this development. As a consequence, liquidity has been flowing elsewhere.
The above clarification coincides with Polkadot’s dominance efficiency. For instance, the community demonstrated a surge in dominance between October and December final 12 months.
This section was characterised by a sturdy worth rally. Polkadot dominance has since then been slashe from 0.63% to 0.%.
Supply: Messari
Polkadot’s dominance bottomed out at 0.27% in the direction of the top of August. This displays the downward trajectory noticed in DOT’s worth motion. It was additionally evident within the community’s efficiency.
An atmosphere characterised by declining liquidity and the lack to faucet into narratives additionally influenced on-chain volumes.
Polkadot’s highest 12-month on-chain quantity was noticed in March this 12 months. Actual quantity peaked at $988.1 million.
Supply: Messari
Polkadot’s each day actual quantity in the previous couple of days was restricted under the $50 million stage. This was additional proof of the extent of how the community’s utility slowed in the previous couple of months, consequently affecting DOT.
Will there be redemption for Polkadot and DOT?
There may be some excellent news regardless of all of the doom and gloom. Polkadot’s ecosystem maintained first rate exercise to date this 12 months. The community just lately reported that the variety of fee-paying transactions working on Polkadot rollups doubled inside the final 12 months.
Learn Polkadot [DOT] Value Prediction 2024-2025
In the meantime, DOT is near its October 2023 lows. That is vital as a result of there was a powerful demand resurgence close to these ranges, resulting in wholesome rally that peaked in March.
Traders might even see this as a possibility to leap in at discounted costs.
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