After a prolonged downtrend that began in March 2025, Polkadot (DOT) is showing tentative signs of short-term strength, posting a 4.41% gain over the past week. This resilience is notable amidst the significant volatility surrounding Bitcoin and a climate of general caution in the broader crypto market.
However, the weekly chart reveals a more challenging landscape. The higher timeframe trend for DOT remains firmly bearish, with a series of lower highs and lower lows established since March. Key bearish structure breaks have persisted since September, reinforcing this dominant downtrend. Momentum indicators on the weekly scale, such as the Awesome Oscillator, continue to signal bearish pressure, while the Accumulation/Distribution line points to steady selling activity. A significant imbalance zone near $2.50 looms as a potential supply area that could halt any advance before a potential next leg down.
A major factor influencing DOT’s trajectory is Bitcoin’s struggle at the formidable $90,000 resistance zone. Despite ample market liquidity, Bitcoin’s inability to decisively break through this barrier has kept a lid on overall altcoin momentum. As analyzed in depth by CoinDesk’s Markets Coverage, Bitcoin’s dominance at key levels often dictates capital flows across the crypto ecosystem, meaning altcoins like Polkadot may lack the sustained, market-wide demand needed for a major independent rally.
On a shorter-term basis, there is a glimmer of bullish momentum. The 4-hour chart at the time of analysis showed positive signs, suggesting the potential for a near-term bounce or consolidation. Yet, it is crucial for long-term investors to distinguish between a lower-timeframe counter-trend move and a genuine reversal of the established bearish trend. Such bounces within a larger downtrend are common and can be deceptive.
The Verdict: A Rally Past $2 is Possible ONLY If…
For Polkadot to mount a credible rally toward and beyond the $2 level, a specific convergence of events is likely necessary:
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A Bitcoin Breakout: The primary catalyst would be a decisive, high-volume Bitcoin breakout above the $90,000 resistance. This would signal renewed risk-on appetite and could funnel liquidity into major altcoins. Traders often watch Glassnode’s on-chain data to gauge the strength behind Bitcoin’s moves.
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Reclaiming Key DOT Levels: DOT itself would need to not only test but convincingly reclaim the $2.50 supply zone as support, flipping it from a barrier into a springboard. This would require a significant shift in market structure on the weekly chart.
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Sustained On-Chain and Development Momentum: Positive fundamentals, such as growth in parachain activity, developer engagement, and network staking metrics—regularly tracked by platforms like Messari—would be essential to support a sustainable price recovery beyond a mere technical bounce.
In conclusion, while short-term bullish momentum on lower timeframes offers trading opportunities, the higher-timeframe odds remain challenging. Investors should monitor the $2.50 zone and Bitcoin’s battle at $90,000 as critical bellwethers. Until these key resistance levels are breached, any rally attempt may be limited in scope, and the prevailing caution in the market is warranted.