Since the recent rally started, altcoins have seen the most significant gains in the market, with Polkadot (DOT) being one of them. Polkadot has been experiencing growth of about 22% over the last seven days.
According to the data from CoinMarketcap, the token is currently trading at $6.1 and has risen by more than 5% in the past 24 hours. The token’s market cap is also up by 4% in the same period.
The token faced several significant drops in value in 2022. The most recent was the fall of the FTX crypto exchange in November, which caused DOT’s value to reach its 52-week low of around $5.
Further, it dropped even more in December, ending the year at $4.31, resulting in a decrease of over 80% in the year. However, somewhat of a recovery occurred in the new year, yet, in the price of the token.
Recently, the Polkadot ecosystem has been experiencing growth and success. According to Santiment, there has been a significant increase in development activity within the Polkadot community, further fueling the already positive trend in the broader cryptocurrency market.
In a recent development, Polkadot has seen a significant increase in the number of DOT in nomination pools, making staking on the blockchain more viable, with over 1 million bonded by members.
In further news, Polkadot Insider announced on Twitter that the network has implemented a new metric known as the “NC.” This new metric ensures that a minimum number of validators are required to make up 33.3% of the network staking share.
The purpose of this is to prevent any malicious actors from manipulating transactions. This higher value ensures higher levels of decentralization, and as a result, Polkadot is currently ranked as the #1 blockchain platform in this regard.
Polkadot (DOT) Prediction
Despite some skepticism that this rally may not be sustainable in the long term, the overall on-chain performance of the ecosystem indicates that the token is likely to break through resistance and continue to rise.
With the token’s current upward trajectory, DOT may continue to reach new heights. Its strong correlation with other major cryptocurrencies will also contribute to its upward movement.
As Bitcoin approaches the $21,422 resistance level, the token is well-positioned to ride on the wave of positive momentum in the coming weeks or months.
From a technical perspective, the $6.4 resistance level is within reach for DOT. A breakthrough past the $6.2 zone could propel the token to potentially reach a peak at $6.8.
However, prices may encounter major resistance near the $7 mark. If prices break down, we may see a further downward correction.
Support levels for the token may be found at $5.8 and potentially at $5.4 or below the current trend line. If these levels are breached, the token may experience a test of around $4.9.
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