Is Polkadot eyeing $100 next? DOT price jumps 25%, triggering classic bullish chart pattern

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Polkadot’s native DOT token seems to be poised to rally toward $100 within the coming classes because it triggers a basic bullish reversal setup.

Dubbed “inverse head and shoulders” (IH&S), the technical construction seems when an instrument varieties three troughs in a row, with the center one — referred to as the pinnacle — being the bottom and the opposite two — generally known as the suitable and left shoulders — of just about equal heights.

In the meantime, the extent at which all of the troughs high out represents the “neckline.”

So, it seems DOT has been forming an IH&S ever since its value correction from the $43–$49 value vary (neckline), as proven within the chart beneath. On Nov. 1, the Polkadot token broke above the area and continued rallying the following day to convey its month-to-date returns to nearly 25% whereas bumping its record high to $53.35.

DOT/USDT every day value chart that includes IH&S sample. Supply: TradingView

The value soar accompanied a rise in buying and selling volumes, exhibiting that merchants supported the transfer above the IH&S neckline. In consequence, DOT’s prospects of rising by as a lot as the utmost distance between its IH&S’s head and neckline (round $39) improved.

In consequence, DOT’s revenue goal out of its IH&S setup comes out to be close to $90, with potentialities of prolonged rallies towards $100, a psychological resistance stage.

Parachain public sale FOMO

DOT’s newest value rally got here as merchants’ focus shifted to its highly anticipated parachain auctions on or round Nov. 11.

The Polkadot staff introduced on Nov. 1 that its council handed the movement that permits parachain registrations and crowdloans starting Nov. 4, including that the proposal now awaits a go-ahead through a public referendum.

Intimately, crowdloans enable rivaling projects to raise capital through DOT to bootstrap their parachain auctions.

Those that help the tasks lock their DOT right into a sponsored account for a predefined interval. In return, they obtain rewards within the type of air-dropped tokens from the venture competing for the parachain slot.

KSM fractal

In June, Polkadot’s test-net chain, dubbed Kusama, performed a similar parachain slot auction. The protocol ended up proving the effectiveness of the crowdloan mechanism, as customers contributed greater than 1.11 million KSM throughout the 5 parachain auctions.

KSM provide devoted to its first 5 crowdloans as of Aug. 6. Supply: Subscan, Messari

That represented over 10% of the whole KSM provide locked.

Associated: Kusama network set to launch its next five parachain auctions

KSM’s value rallied in the days leading up to the auction in June. It peaked out on Could 16 at round $645 after which dropped over 78% to $138.50 two months later. The sell-off additionally surfaced amid an general crypto market decline, led by China’s full-fledged ban on crypto actions.

KSM/USDT every day value chart. Supply: TradingView

Therefore, it seems DOT has additionally been present process a so-called “buy-the-rumor” value rally as merchants wager greater on the parachain public sale occasion. However within the absence of a China-like occasion, the cryptocurrency seems to be to be pursuing the IH&S setup talked about above.

The views and opinions expressed listed here are solely these of the creator and don’t essentially replicate the views of Cointelegraph. Each funding and buying and selling transfer entails threat, and it’s best to conduct your personal analysis when making a call.

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