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The DOT Price Needs a Deeper Correction to $4.75

The DOT Price Needs a Deeper Correction to $4.75

The first December trading week in the DOT market took place in a nervous consolidation situation. The weekly candle closed below the opening price at $5.13. Trading volumes are almost twice less than the previous week. In addition, most of the weekly candles are occupied by pins up and down. All these factors indicate the absence of a dominant force in the DOT market and the continuation of consolidation wars there.

The beginning of this confrontation began on 24 November, when sellers lowered the DOT price by 25% in 3 days. This fall significantly threw buyers off their stride. The decline in their activity is especially noticeable in terms of trading volumes on the daily timeframe:

Source: Trading View

As we can see, a new buyers’ attempt to increase began without consolidating accumulation of positions. The DOT price sharp reversal looked spectacular, but ineffective. Buyers failed to fix in the range of $5.6-6, where began a sharp downward momentum on 25 November.

New local attack of sellers

On 4 December, sellers launched a new local attack as part of the consolidation, which still looks unfinished.

Buyers did not react with a powerful counterattack to the sharp 10% fall of the DOT price. For the set local low of $4.89, so far buyers have managed to correct the price to $5.2. However, in the range of $5-5.2, consolidation has begun, which may mean buyers preparation to attack $5.6-6 again.

The DOT price movement negative scenario

Although, if we consider in more detail the placement of local liquidity zones on the Dot chart, it becomes clear that a good support for a new growth wave is in the range of $4.73-4.77.

DOT

If we analyze where the trading volumes were located during the price increase on 27 November, we see that in the range of $4.75-.52 are the smallest number of interested market participants to carry out financial transactions. Therefore, the DOT price unsuccessful consolidation in the current local consolidation will drastically send buyers to protect $4.75.

The last fact of the probable negative scenario will be the DOTBTC pair chart:

DOT

On 18 November, we see an active buyers’ interest in this pair, which is accompanied by a sharp price shot on high volumes. At the moment, the price is again at a critical point, but we do not see any active buyout or retention by buyers. Hence, the DOT fall continuation is a very likely scenario if trading volumes remain as they are now.

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