Polkadot’s (DOT) price surged by 12% following Grayscale’s application for an exchange-traded fund (ETF) for the cryptocurrency. This move comes weeks after the asset management firm filed for XRP and Dogecoin (DOGE) ETFs.
Before the disclosure, DOT’s price was $4.30. While trading closer to $5 now, CCN observes that it has yet to break above a bearish pattern, questioning the rally’s sustainability.
With DOT at a critical juncture, will the price break above this resistance? This analysis looks at the possibility.
According to CCN’s findings, the firm submitted a 19b-4 form to the regulatory agency to review the application and confirm whether the ETF could begin trading on the exchange.
If approved, the ETF will grant investors exposure to DOT through shares, not the cryptocurrency itself. Interestingly, Grayscale is not the only asset manager interested in a Polkadot ETF.
21Shares filed to launch a similar product earlier this month, but DOT’s price reacted differently.
The daily chart showed two bearish engulfing candles between February 2 and 3, indicating a decline at that time.
Despite the price increase this time, DOT’s price keeps trading within a descending triangle.
A descending triangle is a pattern that features a falling upper trendline and a flatter horizontal lower support, signaling potential downward price movement.
As seen above, Polkadot’s price has bounced off the support at $4.41. However, it is still confined within the pattern and has yet to break above the upper trendline.
Failure to rise above this trendline might make it difficult for DOT’s price to test the resistance near $6.31 and $7.44.
Bearish Setup Puts DOT at Risk
On the same daily chart, the Supertrend indicator seems to align with the thesis. The Supertrend shows if a cryptocurrency is in a downtrend or uptrend.
When the green line of the indicator is below the price, the trend is bullish, and the price can increase. For instance, this was the case around November 2024, as DOT’s price increased from $3.80 to $10.6 by the following month.
This time, the red segment of the Supertrend is above the price, indicating a bearish position. If sustained, DOT’s price might not be able to breach the resistance by nearly $6.
If validated, this technical setup could push DOT back, and the price might fall below $4.
However, if DOT breaks above the upper trendline of the triangle pattern, the uptrend might continue.
In that case, the token could rise toward $8. Also, if the SEC acknowledges the Polkadot ETF and the process of potential approval advances, this could lead to increased demand. In that case, DOT could rise above $10.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Victor Olanrewaju is a crypto analyst and reporter at CCN with deep roots in on-chain research and technical analysis. His crypto journey began in 2017, but it was the 2020 Uniswap airdrop that sparked a full-time pivot into the space.
With a foundation in copywriting, Victor honed his craft creating high-converting content for leading crypto brokers — most notably an XRP price prediction that ranked #1 on Google during the 2021 bull run.
He later joined AMBCrypto in 2022, where he combined storytelling with technical and on-chain analysis to cover key market narratives.
In 2024, he expanded his expertise at BeInCrypto, collaborating with analysts and using tools like Glassnode, Santiment, and IntoTheBlock to break down Bitcoin and altcoin trends.
At CCN, Victor covers the top cryptocurrencies, memecoins, macro shifts, blending real-time insights with deep-dive metrics.
He holds a Bachelor’s degree in Physics from the University of Ibadan, equipping him to simplify complex data for a wide audience. Follow his work or connect on LinkedIn or X.
