Polkadot Forms a Bullish Reversing Pattern
Polkadot has stalled today after being bullish for two days
Cryptocurrencies have been uncertain since the crash about a month ago, which took them down in the biggest bearish move ever in this relatively new market. Cryptos lost between 50% and 60% of their value during that crash, which took Polkadot from just below $50, down to under $14.
The decline took the price below all the moving averages, which didn’t provide any support whatsoever during the crash. But the big crash eventually ended, and Polkadot has been making higher lows since then, while the highs during attempts to reverse the price, have been getting lower too. Right now Polkadot is holding nearly half the gains from this year’s major bullish trend.
So, a triangle is forming in the DOT/USD. Over the weekend, this cryptocurrency formed a bullish reversing chart pattern on the daily time-frame. A small hammer candlestick formed on Saturday, which points to an upward reversal after the slight decline, while yesterday’s candlestick looks quite bullish.
Today, however, we are not seeing a follow-through of the bullish momentum of the weekend, like in Bitcoin. The positive sentiment as a result of Elon Musk’s comments is not filtering through the whole crypto market, so Polkadot is not benefiting from it.
The price has moved above the 20 daily SMA (gray), but it has stalled today. We are long on this crypto already, so we are holding onto our trade, hoping that Bitcoin breaks above $40,000 soon and pulls the rest of the crypto market up with it.
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