Polkadot (DOT) has been in a consolidation phase for much of 2025, with its price stabilizing between $4.25 and $5.20 in recent weeks. Despite ongoing bearish signals on both the daily and 4-hour charts, there are indications that a short-term bounce could lead to a 20% surge in the coming days. Here’s a deeper dive into what’s happening with Polkadot’s price action and the potential for an upward move.
Over the past month, Polkadot has been consolidating around the $4.20 mark, a level that sits just above the lows from November, which fueled the initial rally to $11.65. Despite this consolidation, there is no significant sell pressure in the market, allowing Polkadot to hold its ground within this range. As of now, the altcoin is moving within the $4.25 to $5.20 range, a period that has been marked by relative price stability.
Although the long-term trend for Polkadot appears bearish, technical indicators suggest that a potential short-term upward move could be on the cards. Currently, the price action shows bearishness on both the daily and 4-hour timeframes. The Awesome Oscillator, a tool used to measure momentum, is signaling downward momentum as it remains below zero on the daily chart. Moreover, the Chaikin Money Flow (CMF), a metric that shows the buying and selling pressure, has not shown any significant movement either in or out of the market, signaling a neutral stance.
This lack of overwhelming selling pressure could explain why Polkadot has been holding steady between $4.25 and $5.20 despite the overall bearish structure. According to market data, Polkadot has experienced several bounces in this range over the past weeks, with each bounce taking approximately three to seven days to reach the upper end of the $4.25-$5.20 zone.
The $4.20 support level has been a critical point for Polkadot. A recent bounce from this level suggests that the altcoin is once again testing its lower boundaries, but this does not necessarily imply a continuation of the bearish trend. In fact, the market structure on the 4-hour chart hints at the potential for a short-term price increase.
On the 4-hour timeframe, Polkadot’s price appears to be recovering from the $4.20 region, indicating that a price bounce may already be in progress. However, the price will likely face resistance around the $4.60 level. Should Polkadot manage to break above this point, it could retest the $5.20 mark, where significant resistance lies. If the bulls manage to push through this barrier, Polkadot could see a 20% move higher, taking the price closer to $6.
While the technical indicators suggest potential bullish movement, liquidity plays a significant role in driving Polkadot’s price. The market’s reaction to the liquidity levels around the $5.20 region is a crucial factor to watch. On Monday, Polkadot’s price dropped from $5 to $4, testing liquidity to the downside. This move has led to an increase in liquidation levels around the $5.20 area, setting the stage for a potential upward move.
The build-up of liquidity in the $5.20 region means that if Polkadot’s price continues to hold above the $4.20 mark, the altcoin could see a shift towards the next magnetic zone, which could result in a roughly 20% price increase.
It’s essential to consider the broader market conditions when evaluating Polkadot’s potential price action. As Bitcoin (BTC) remains a significant driving force for the crypto market, its short-term price movements can have a substantial impact on altcoins like Polkadot.
If Bitcoin manages to maintain its upward momentum and breaks through key resistance levels, Polkadot could follow suit and experience a similar surge. However, if Bitcoin fails to hold onto its gains and struggles to move towards its target of $92,000, Polkadot may face headwinds and could struggle to achieve a price bounce.
Despite the bearish structure present on the daily and 4-hour charts, the lack of significant selling pressure, combined with the current price consolidation, suggests that Polkadot could be gearing up for a short-term bounce. Traders should keep an eye on the $4.20 support level and the $4.60 resistance level, as a break above the latter could signal a move towards $5.20 or even higher.
However, external factors, such as Bitcoin’s price movements, will play a crucial role in determining the direction of Polkadot’s price. If Bitcoin continues to rally, Polkadot may follow suit and see a 20% surge. On the other hand, if Bitcoin’s momentum wanes, Polkadot may face a period of further consolidation or downward pressure.
A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5
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