Polkadot Dips to Attractive Buy Point

Down more than 20% in a week's time, Polkadot is being eyed by the crypto bulls who believe in the potential of the seasoned cryptocurrency project.

Will DOT rebound after its recent falls?

Daily time frame analysis

DOTUSD - 1 Day Time Frame

DOT is currently trading at mid-bear market levels. After touching the marked resistance, DOT formed a bearish pattern and lost this year's bull market support. The price has decisively moved below this support and now needs to form a bottom.

Before the market takes off, coins anchored around bear market prices are likely to decline further.

However, this phase of the bull market offers a significant accumulation opportunity. DOT is expected to visit the marked Value Area Down, representing the lowest point of value distribution since October 18th.

Below this point, there are few positions to hold the price up unless DOT forms a bottom here. If this level is lost, the most solid support lies at the bear market low.

Two-hour time frame analysis

DOTUSD - 2 Hour Time Frame

The marked blue area pinpoints the local lows that DOT is likely to visit due to Bitcoin's weakness. If Bitcoin reacts strongly around $56,550, DOT could follow the blue path, representing a potential (though not exact) price action.

This could be a final complacency bounce before DOT goes lower or establishes its support.

A quick reclaim of these levels offers a great trading opportunity. These levels often hold investors' stop losses or liquidation prices, causing quick wicks that are usually bought up. Therefore, monitoring liquidations around these prices is advisable.

A high magnitude of liquidations might indicate a solid entry point. Additionally, complacency bounces are weaker, so the price might front-run the marked red line, which was previously a resistance on lower timeframes.