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With “Uptober” truly being a Bitcoin month so far, most of the top altcoins either consolidated or rode on the larger market-driven gains. Bitcoin noted close to 15% gains while was up by just 5% whereas top alts like Cardano and Solana saw losses.
Polkadot, the 8th ranked alt, however, seemed to have gained some decent momentum. As DOT noted 6.5% daily and 13% weekly gains, trading at $36.2 at the time of writing, once again speculations about the alt reaching its ATH rose.
This time, as Polkadot comfortably sat above the crucial $33 resistance, the real question was whether these gains were market-driven. If not, then, can they sustain?
Previous rallies at a glance
After the flash crash, DOT rode on renewed bullishness as the alt’s price on the daily chart saw parabolic recovery similar to the one witnessed towards the beginning of the year. However, that was met with considerable losses and consolidation.
Notably, DOT’s price has been sensitive to BTC’s and has more or less followed the top coin’s lead throughout the last month. But the bright side was that DOT held better than the larger market when BTC dropped.
Notably, on a 12-hour chart, RSI had finally entered the overbought zone after more than a month. DOT’s price could be aiming for 20% gains as it flipped the $33 level as seen during the previous rallies. Looking solely at the price structure, the chances of an ATH looked high but what about on-chain data?
Can these factors play a spoilsport?
Amid high anticipation from DOT’s price and heightened hope that the network could announce the Polkadot parachain auctions next week during the Sub0 Online event, DOT’s social volumes saw major spikes with Polkadot being a ‘project in trends’ on social media.
Even though, historically DOT’s high social volumes haven’t had a major correlation with its price, the positive sentiment was good for the network. However, the network saw weakened development activity as it fell by more than 50% in the last five days from press time.
That said, DOT’s Open Interest in the futures market was at an ATH of $745.75 million since the May sell-offs. This indicated a rise in the number of outstanding contracts held by market participants while also underlining the fact that new capital was flowing into the coin’s markets.
Thus, while the chances of DOT reaching an ATH looked solid, the possibility of a trend reversal as seen earlier if the larger market consolidates also couldn’t be dismissed. All in all, DOT seemed to be at interesting crossroads.
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