Polkadot (DOT) Tests Key Support: Will It Break Out or Drop Further?

• Polkadot approaches a crucial support level, with traders anticipating either a breakout or further downward movement.
• A breakout from the descending channel could drive DOT toward $7.59, $9.91, or even $11.64 if buying momentum strengthens.
• If support fails, further losses may follow, but past market trends indicate strong buyer activity at this price range.

Polkadot (DOT) is nearing a critical support level, signaling a potential shift in price direction. The coming sessions will determine whether the asset stabilizes or continues its downward trend.

Market Structure and Support Levels

Crypto analyst Lucky has noted a very significant support area for DOT, which is a crucial aspect for the asset. Price previously broke from a falling wedge and initiated a strong rally before it settled within a descending channel. DOT has been consistently decreasing ever since, forming lower highs and lower lows.

DOT is consolidating near a support level that has held in past market cycles. If buyers defend this area, a breakout from the descending channel could follow. Previous movements suggest that such breakouts have led to significant price increases, making this a crucial moment for traders.

Potential Price Movements and Resistance Levels

If the support level holds, DOT could rally toward resistance at $7.59 and $9.91. With strong momentum, the price may extend gains to $11.64, aligning with past recovery patterns. A breakout from the descending channel could signal the beginning of a bullish phase.

On the downside, failure to maintain support could result in further declines. The descending channel indicates continued selling pressure, though previous price action suggests buying interest remains strong. The next sessions will determine whether DOT stabilizes or extends its downward movement.

Participants in the market are following price activity closely to try and gauge what the next large move will be. Market dynamics will play an important role in determining DOT’s short-term momentum. The days ahead will provide a sense of whether the asset recovers or continues lower.