The price of Polkadot (DOT) has increased by 10% in the past 24 hours, impressively rising by 178.44% over the past 30 days, reflecting strong bullish momentum. However, technical indicators suggest that the price surge may be weakening, with both RSI and CMF indicating diminishing buying pressure.
While the EMA lines of DOT remain bullish, the fading uptrend may cause the price to test support levels. Conversely, if bullish momentum returns, DOT may aim for the next resistance level, with the potential to break the highest point since April 2022.
The RSI of DOT cools down
Currently, the RSI of DOT is at 62, slightly down after surpassing the 70 threshold for the first time since November 24. The recent breach of the 70 mark indicated overbought conditions and strong buying momentum, while the drop to 62 suggests a slight slowdown.
Despite the pullback, the RSI remains in the bullish zone, reflecting ongoing optimism from investors.
The RSI index of DOT | Source: TradingView
The Relative Strength Index (RSI) measures the speed and change of price movements, with values above 70 signaling overbought conditions and below 30 signaling oversold conditions. At 62, the RSI of DOT reflects positive momentum, although it is no longer at a peak.
If the RSI stabilizes or climbs back above 70, Polkadot could witness a new price surge. Conversely, a drop in the RSI below 60 may signal weakness and lead to sideways movement or a slight correction.
The CMF of Polkadot remains positive
The CMF (Chaikin Money Flow) index of DOT is currently at 0.07, down from a recent peak of 0.22, the highest since November 23. This decline indicates that although buying pressure remains, it has weakened compared to previous intensity.
The positive CMF value still indicates net inflows into DOT, reflecting overall bullish sentiment. However, the downward trend of this index signals a potential weakening of bullish momentum.
The CMF index of DOT | Source: TradingView
CMF measures the flow of money into and out of an asset based on price and trading volume, with values above 0 indicating buying pressure and below 0 reflecting selling pressure. Although the CMF of DOT remains positive at 0.07, the drop from 0.22 may signal a weakening in bullish momentum.
If the CMF continues to decline, this may indicate increased selling activity, leading to sideways movement or a correction. Conversely, if the CMF recovers to higher levels, this could stimulate a resurgence of bullish momentum.
Price prediction for DOT: Could Polkadot reach $12 by December?
The EMA lines of DOT continue to maintain an upward trend, with short-term lines above long-term lines, indicating that bullish momentum is still ongoing. However, other indicators such as RSI and CMF suggest that the current uptrend may be weakening.
The DOT/USDT 4-hour chart | Source: TradingView
If buying pressure continues to decline, the price of Polkadot may test the support level of $8.4, with the potential for a deeper drop to $7.5 if this support level is broken.
Conversely, if the uptrend regains strength, the price of DOT may target the important resistance level at $11.6. If it surpasses this level, the price could move toward $12, a milestone not seen since April 2022.