Polkadot is in green in the last trading week despite a weak conclusion of the week.
After impressively rising 30 percent from 2022 lows and breaking above a descending channel, there is a bear engulfing pattern in the daily chart printing at around $20—a round number.
Technically, there should be a high volume close above this level for the uptrend to be valid and prices to inch higher as Polkadot attempts to bottom-up after shedding over 50 percent from 2021 peaks.
Polkadot Scaling Through Parachains
At spot rates, Polkadot proponents are bullish. The rejection of lower lows and a close above $20 may trigger another leg up towards $30. Pumping DOT would be an array of fundamental factors, especially announcements from top projects launching on Polkadot, winning Parachain slots.
There will be 100 parachains all connected to the Relay Chain, deriving its security from the globally distributed maze of validators. Parachains exist independently, and slot owners can opt to use their choice consensus algorithm to suit their creations.
Enjin to Launch Efinity on Polkadot
The latest to launch on Parachain is Efinity by Enjin to release what would be the first NFT-focused independent chain on Polkadot. Eventually, Efinity will be the home of hundreds of blockchain-based games, further demonstrating the increasing role of NFTs in crypto.
In 2022, it is estimated that there were approximately $40 billion in registered NFT trading volumes. This number is expected to rise in 2022 as NFTs, spurred chiefly by blockchain games, find adoption.
Polkadot Price Analysis
DOT is up 30 percent from 2022 lows, trading within a bullish breakout pattern, as evident in the daily chart. When writing, the immediate resistance level is at $20, and bulls have found a ceiling at this reaction point.
Although sellers might push down, unwinding gains, DOT buyers have the upper hand in the immediate term, provided prices are above $17. Therefore, any dip from $20, ideally inside the March 16 bull bar, could be loading points for aggressive traders targeting $23 in the short term.
Notice that DOTUSDT prices are in a tight trade range within the March 16 bull bar and accompanying trading volumes are relatively low. This formation signals strength, supporting the bullish preview. A dump below $17 and into the multi-month descending channel may force DOT back to $15.
Technical charts courtesy of Trading View
Disclaimer: Opinions expressed are not investment advice. Do your research.
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