The Polkadot price has recovered sharply from yesterday’s cryptocurrency carnage and is higher by +75% in early Thursday trading.
DOT/USD lost 70% of its value in the two days following my warning that prices had overheated.
Whilst I felt that the price run had gotten ahead of itself. I couldn’t imagine that the sell-off would lead to such heavy losses for the Polkadot price.
The sheer magnitude of yesterday’s wipeout is incredible. Over $1 trillion wiped off the combined value of crypto assets in 24 hours.
Before the liquidation event, the Polkadot price had been on a great run. At its $50.7600 high on the 15th of May, it had returned investors 527% in 2021.
The four days that followed saw that return more than cut in half. Even after today’s 75% rally, the $28.000 price is higher is now only +247% from the start of the year.
Polkadot Price Technical Outlook
The recent jump from yesterday’s low of $15.7700 has seen the price reclaim the support of a descending trend line at $24.8650.
The line has been in place from the 26th of Feb, and previous touches have seen the Polkadot price bounce hard.
In fact, the last two touches of the support sent the price to a new all-time high. Therefore this should be considered a key level to watch.
Suppose the Polkadot price can continue its current upside momentum and stay above the trend. It may well continue higher. A failure to stay above the important threshold may suggest that the price is not out of the woods yet and may signal a continuation of yesterday’s price decline.
It’s too early to say if the last of the longs have bailed. This may turn out to be a relief rally ahead of more liquidation or, indeed, just a correction in an ongoing bull market.
It’s too soon to give a Polkadot price prediction after the recent volatility. But the price will calm down over time and provide traders with clear opportunities.
Watch this space
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