Key Takeaways
- Polkadot and Kusama are sitting in oversold territory after diving by more than 28%.
- Now, DOT and KSM are presenting buy signals on their daily charts.
- A spike in upward pressure could help both tokens rally by over 16%.
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Polkadot and Kusama appear to be on the brink of a bullish impulse. Still, both assets need to overcome a hurdle to achieve their upside potential.
Polkadot, Kusama Look Ready to Rally
Polkadot and Kusama appear to be gaining bullish momentum for a rebound after both tokens incurred significant losses over the past 11 days.
Polkadot’s DOT token has recently endured a steep downtrend, losing 28.72% in market value since peaking at $23.85 on Apr. 2. Polkadot appears to have found vital support around the $17 level. Meanwhile, one technical indicator suggests that the asset is trading in oversold territory and could be ready to bounce.
The Tom DeMark (TD) Sequential indicator currently presents a buy signal on DOT’s daily chart. The bullish formation developed as a red nine candlestick, indicative of a one to four daily candlesticks upswing or the beginning of a new uptrend. A spike in buying pressure around the current price levels could help validate the optimistic outlook.
Polkadot must print a daily candlestick close above $18.30 to encourage sidelined investors to re-enter the market. Breaching this resistance level could confirm the buy signal presented by the TD and push Polkadot to $19.50 or even $21.
Kusama has also reached a crucial demand area after plummeting since Apr. 2. The $148 support level has prevented KSM from dipping further and could serve as a rebound zone. Still, it must breach critical resistance to be able to advance further.
The TD has also presented a buy signal in the form of a red nine candlestick on Kusama’s daily chart. KSM must make a decisive close above the $160 resistance level for the bullish formation to be validated. Slicing through this hurdle could result in an upswing to $180 or even $207.
It is worth noting that Polkadot and Kusama must remain trading above support for the bullish outlook to prevail. If DOT dipped below $17, it could dive to $16. KSM, meanwhile, faces a drop to $136 if it does not hold $148.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
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