Tracking the revival of DeFi’s TVL is the recovery of the Polkadot price. The coin that’s core to the interoperability promoting protocol is one of the top performers in the top 10, gaining against established currencies like Bitcoin and Ethereum.
At the time of writing on Mar 3, the DOT price is up five percent on the last day of trading, pushing weekly gains to 15 percent. Technically, buyers are back in contention.
However, the uptrend needs to be with relatively higher trading volumes. It will signal determination from buyers who are more likely to thrust DOT/USD to new 2021 highs, an achievement for the recently launched project.
Even though DOT/USD prices are inching high, gaining versus the greenback on the last day, the average daily trading volumes are relatively low.
According to trackers, participation fell four percent on the last day as roughly $2.9 billion worth of DOT changed hands across different ramps.
Polkadot Price Overview
The DOT price is trending at around all-time highs. Notably, DOT bulls have successfully unwound losses of last week and are firm above the middle BB.
The Bollinger Band (BB)—one of the most popular cryptocurrency trading indicators used to measure volatility. Presently, the uptrend is firm. The demand from lower time frames is fueling volatility, which explains the widening lower and upper BBs.
The middle BB acts as the immediate support line. A break below this level could see the DOT/USD price fall back to around Jan 2021 highs of $20. On the flip side, immediate resistance is at Feb 2021 highs of around $42.
As price action tries to find a fair price, a break above this could spark another wave of DOT demand. This will subsequently lift the coin to a new 2021 high in a bull trend continuation pattern.
Polkadot Market Movers
Polkadot will help interconnect blockchains. Center to this will be parachains. They are the last puzzle that will enable Polkadot to achieve its objective as outlined in its whitepaper.
Parachains are the last piece of core functionality to be delivered as outlined in the whitepaper, and will allow Polkadot to realize its scalable multi-chain architecture. Parachains will launch via on-chain governance after a period of testing, optimization and auditing.
— Polkadot (@Polkadot) February 22, 2021
For what Polkadot seeks to achieve–and being among one of the first blockchains offering to launch a functional, multi-chain architecture that’s secure and scalable, it has received the attention of institutional investors.
For instance, Tidal Finance, a project that wants to introduce decentralized insurance in Polkadot, raised $1.8 million through a token sale.
With financial enabling, the protocol plans to launch in mid-April. Its testnet has been live for two weeks, but development began in September 2020. The Polkadot-based DeFi project’s investors are Hypersphere Ventures, Spartan Capital, Kenetic Capital, and QCP Capital.
Polkadot Price Prediction
The DOT/USD trend is bullish, adding 15 percent week-to-date.
Immediate support and resistance lie at the middle BB and $42, respectively. These are reaction points of the last three weeks. Specifically, bulls have a ceiling at $42 which flashes with Feb 2021 highs.
Technically, lower lows confirm losses of last week. A firm break below the middle BB with high trading volumes could see the DOT/USD price reach $20.
On the other side of the coin, sharp gains above $42 may see the DOT price surge to $64. It is the 3.618 Fibonacci extension level of the Jan 2021 trade range.
Chart courtesy of Trading View
Disclaimer: Opinions expressed are not investment advice. Do your research.
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