Polkadot (DOT) price is showing a bullish reversal signal on both the weekly and daily timeframes.
Kusama (KSM) has dropped to a new yearly low and is yet to break out of a descending resistance line.
DOT price reaches long term support
The price of Polkadot has been declining since reaching an all-time high of $55.09 in November 2021. The downside movement has so far reached the October 2022 low of $5.68. A low was formed inside the longer term $5.80 horizontal support. area, which had not previously been reached since early 2021.
The weekly RSI movement is leaning towards a bullish outlook. Over the past four months, the indicator has generated a bullish divergence (green line). However, the RSI is still following its descending resistance line and is trading below 50.
Unless it breaks out of the resistance line and then moves above 50, the price prediction for DOT cannot be considered bullish.
The daily time frame readings support those from the weekly time frame. DOT price broke above a descending resistance line and later validated it as support, creating a long lower wick (green icon) in the process.
Similar to the weekly time frame, the daily RSI has also generated a bullish divergence (green line). Therefore, an upward move is supported by technical analysis readings from both timeframes.
If there is an upward move, there is short-term resistance at $7.75. This is a horizontal resistance area and the 0.5 Fibonacci Retracement resistance level.
This is the last resistance area before the August high of $9.70. As a result, a movement above it can greatly accelerate the rate of growth.
Conversely, a decline below $5.68 would indicate that the trend is still bearish.
KSM struggles to initiate upward movement
The price chart for KSM doesn’t look nearly as sharp as for DOT. KSM has been falling below a descending resistance line since the beginning of August. The line has been validated three times (red sign), most recently on 10 October.
While doing so, KSM price also broke the $45.50 area and later validated it as resistance.
On the bullish side, the daily RSI has formed a bullish divergence (green line). Divergence occurred at the minor Fibonacci support level of $36.10. However, apart from this divergence, there are no other bullish signals.
Even if there is a breakout from the line, the $45.50 area will now act as a strong resistance. Unless KSM manages to break out of it, the trend cannot be considered bullish.
If the decline continues, the next nearest support area will lie at $27.05.
For the latest BeInCrypto Bitcoin (BTC) and crypto market analysis, click here
Disclaimer: BeInCrypto strives to provide accurate and up-to-date information, but will not be responsible for any missing facts or incorrect information. You comply and understand that you should use this information at your own risk. Cryptocurrencies are highly volatile financial assets, so do the research and make your own financial decisions.
Disclaimer
All information contained on our website is published in good faith and for general information purposes only. Any action taken by readers on information found on our website is strictly at their own risk.