After six weeks on the rise, it seems Polkadot price has run out of steam and could be headed south. Ahead of its parachains auctions launch yesterday, there had been a lot of hype around DOT. However, the excitement seems to have fizzled out after the asset hit an all-time high of $55 eight days ago. At the time of writing, DOT was trading at $46.92, which was about 11.5% lower than its position a week ago. That makes it the biggest loser among the crypto market’s top 10 assets.
Cautious approach to parachains auctions
Many investors are counting on the Polkadot parachains auctions launched yesterday to help propel the token to a new level. The slots for the first batch of five projects were put up for auction yesterday and the auction will end tomorrow. It is probable that some investors might have adopted a cautious approach towards the auctions, hence the current decline. However, DOT could bounce back strongly next week if the first auction proves successful.
Technical analysis for Polkadot price
Polkadot price has been on an ascending trajectory over the past two weeks, as shown on the rising channel. However, the price action has weakened over the past three days. The momentum is currently neutral, with the RSI at 51. If it weakens and the price breaches the support at $44.87, it could signal the possibility of a reversal. The reversal will be confirmed if the price reaches $39.84.
However, if the buying momentum strengthens, the price could rise to the first resistance at $49.94. Beyond that point, the next resistance is likely to be at $53.44. That will be a strong signal of continuation of the uptrend.