Polkadot (DOT) Price Momentum Builds As Open Interest Climbs – Details

Christian Encila

Last Updated: July 17, 2023 12:30 pm

3 mins read

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Polkadot (DOT) has enjoyed a successful three-week period, with bullish investors maintaining their position at the forefront despite fluctuations in the market.

In addition, the recent legal victory of Ripple against the US Securities and Exchange Commission triggered a positive response across the entire market, benefiting not only significant cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) but also altcoins in general.

Nevertheless, it is essential to note that Bitcoin and Ether experienced notable downward corrections in the short term after they attempted to surge higher last week. As a result, there might be some selling pressure soon for these leading cryptocurrencies, which could potentially harm the price of DOT.

Given this scenario, how can DOT bulls regain control and overcome a potential market correction?

DOT Price Update: Minor Dip, But Open Interest Improves

The latest update on DOT’s price from CoinGecko shows that it currently stands at $5.30. While the cryptocurrency experienced a slight decline of 1.7% over the past 24 hours, it still managed to maintain a seven-day rally of 4.8%. However, a closer analysis of the DOT price report shows some concerning indicators.

Source: Coingecko

According to a report, by mid-June, the Open Interest had significantly diminished compared to its April levels, signaling a bearish sentiment. However, as the month advanced, a reversal in this trend emerged.

Source: Coinglass/AMBCrypto

The declining Open Interest in April, which refers to the number of open contracts in the market, served as an early indicator that hinted at the forthcoming bearish sentiment.

As traders and investors reduced their positions and interest waned, it reflected a growing caution and skepticism in the market. This downward trend in Open Interest implied a decrease in market participation and a potential lack of confidence in the prevailing bullish trends.

However, as June unfolded, a gradual and encouraging shift in market sentiment began to take shape. Market participants started to exhibit a more optimistic outlook, which was reflected in the increasing Open Interest. This surge in OI suggested renewed interest and activity, as traders and investors re-entered the market and established new positions.

DOT market cap currently at $6.3 billion. Chart: TradingView.com

Polkadot Potential Rebound Tied To Bitcoin’s Resilience

On the other hand, if BTC can stabilize or even climb back above $31,000, DOT will likely follow suit. The correlation between BTC and altcoins like DOT has been a well-established trend in the cryptocurrency market.

BTC, the dominant cryptocurrency and a significant influencer of market sentiment, often sets the tone for the overall market direction. If Bitcoin regains stability and exhibits a bullish move, it tends to ignite a favorable view among traders and investors. This positive sentiment, in turn, could extend to altcoins like DOT.

DOT seven-day price movement. Source: CoinMarketCap

Therefore, for DOT bulls looking to reclaim their yard and counteract the potential negative impact of a market correction, monitoring BTC’s performance closely becomes crucial. If Bitcoin can stabilize or, ideally, recover above the significant resistance level of $31k, it would likely create a favorable environment for DOT to regain momentum.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from VOA News

Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.