DOT/USD has come off support levels seen only three days ago near 13.5000 and attained enough momentum upwards to challenge short-term highs. The sudden bullish run will certainly get the attention of speculators, but before getting caught up in the potential of an exuberant trajectory with positive gains and new highs, traders need to consider that DOT/USD remains within the lower realms of its mid-term price range.
A simple look at a one-month chart highlights that Polkadot is still within a strong bearish trajectory. The broad cryptocurrency market has been able to achieve slight gains the past couple of days, but this comes on the heels of having been taken to important support levels which are still within sight and could certainly prove vulnerable if another round of selling pressure ignites. An uneasy calm is dominating the broad cryptocurrency market and this should make traders slightly nervous.
Volatility remains a key ingredient for DOT/USD and this will likely attract aggressive speculators who enjoy the potential of big percentage changes in value. As Polkadot trades near the 16.3500 juncture as of this writing, the levels of 16.6000 and 16.8000 should be watched as important short-term resistance. If these ratios are penetrated higher this could certainly set off a test of the 17.0000 mark and above. The last time DOT/USD traded above the 17.0000 juncture with any real force was on the 21st of June.
From a risk/reward perspective, traders should ask where the greatest chance of seeing a large move will develop, and in which direction? While the past couple of days have certainly produced a rather solid gain since the 13.5000 value came within sight, traders could prove to be correct if they now believe another reversal lower will take place sooner rather than later.
Unfortunately for bullish speculators, the mid-term trend for DOT/USD and most major cryptocurrencies remains locked within a negative light. Yes, there is no doubt Polkadot has the capability to suddenly begin penetrating resistance levels consistently and emerge with a value that is breathtaking compared to where it is trading today. However, until DOT/USD is able to consistently produce upwards momentum, speculators may be inclined to actually wager that the downside has opportunity. Selling DOT/USD on slight reversals higher remains an attractive speculative wager that may be worth pursuing.
Polkadot Short-Term Outlook:
Current Resistance: 16.6000
Current Support: 15.8800
High Target: 17.3000
Low Target: 14.7100
