Polkadot (DOT) Poised for a Rally Following 400% Surge in ICP’s Price
DOT and ICP’s values have rallied significantly in the last month.
However, ICP’s value gains have outpaced DOT.
DOT appears poised to initiate an uptrend to catch up with ICP.
Polkadot (DOT) has been closely trailing Internet Computer (ICP) in recent price gains, sparking discussion among crypto analysts about whether DOT is due for a significant upward swing.
In a recent post on X (formerly Twitter), crypto analyst Tony Bitcoin opined that DOT might be poised for a potential catch-up rally following the 400% surge in ICP’s value since November 2023.
#Polkadot #DOT and #ICP I have been observing for some time that they are on a par, $ICP has gone up from its minimum 400% and $DOT 150% so now it has to be equalized with $ICP and so now $DOT has to go up 250% pic.twitter.com/VcxVD2gLh0
— Tony ₿itcoin⚡ (@Toni_Bitcoin) January 4, 2024
Rally Looks Likely
An assessment of DOT’s price movement on a weekly chart showed that the predicted rally might occur.
DOT/USDT 7-Day Chart (Source: TradingView)
An indicator that suggested this was the coin’s ADA’s Parabolic SAR (Stop and Reverse). At press time, the dotted lines that make up the indicator were positioned below DOT’s price.
When this indicator moves in this manner, it signifies a bullish trend. An increasing gap between an asset’s price and its SAR suggests that the asset may have room to climb further before the SAR catches up and signals a potential reversal.
Further, despite the 16% price retracement last week, DOT traders have continued accumulating the altcoin. Key momentum indicators were spotted in uptrends at the time of writing.
For example, the coin’s Money Flow Index (MFI) was 85.86, while its Relative Strength Index (RSI) was 58.23.
Likewise, the altcoin’s Chaikin Money Flow (CMF) rested above the zero line at 0.17. At this value, the CMF showed that the DOT market witnessed an adequate inflow of liquidity.
Confirming the bullish trend, readings from ADA’s Moving average convergence divergence (MACD) indicator showed the MACD line (blue) above the trend line. When these lines trend in this manner, it means that buying momentum exceeds coin sell-offs.
However, due to the recent price dip, DOT’s derivatives market participants have gradually exited their trading positions. According to data from Coinglass, the price decline in the last week has been accompanied by a drop in DOT’s futures open interest.
At $226.81 million at press time, it has declined by 29% since 26 December.
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