Bulls Are Buying The Dips In Cryptocurrencies Polkadot And Link
Link (CRYPTO: LINK) and Polkadot (CRYPTO: DOT) are down 13% and 30%, respectively, from their all-time highs amid Bitcoin’s (CRYPTO: BTC) retreat into consolidation.
With the raging popularity of cryptocurrencies lately, Link and Polkadot’s downturn may just be a much-needed cool-off period as both charts are still flashing bullish signals.
The Polkadot Chart: This past Saturday, Polkadot made a run towards its all-time high of $50.70 made back on its Kraken exchange debut on Aug. 18, 2020. The cryptocurrency was unable to reach it and has since lost two support levels at $42.18 and $37.55 while holding and bouncing off support near the $32 mark. The lower wicks on the daily chart indicate any dips in Polkadot are being bought by bulls, however.
Although the downturn caused the eight-day exponential moving average (EMA) to cross below the 21-day EMA, which is bearish, Polkadot printed a bullish hammer candlestick on Tuesday indicating a reversal in the downtrend. A push back up above $37.55 would help Polkadot to regain the eight-day EMA and trade back above it.
Bulls want to see a continuation of the hammer reversal pattern and for Polkadot to pop back up over its overhead resistance. If Polkadot is able to regain the $36 level, it has room to move back up towards $42.
Bears want to see the bullish hammer pattern negated and for Polkadot to set up a bear flag pattern under $36. If the bear flag becomes the more recognized pattern, the stock could retest support at $31.87. A loss of that support level could see Polkadot revisit $27.78
The Link Chart: Although Link is trading near its all-time high of $44.34, the past three trading days have created a new resistance level at $39.07 as the cryptocurrency has failed to trade above it. Like Polkadot, the daily candles have long lower wicks indicating bulls are buying any dip.
Link is trading above both the eight-day and 21-day EMAs with the eight-day EMA trending above the 21-day EMA which is bullish.
Bulls want to see Link jump up over the $39 level to make a run back for all-time highs. If it can clear $44.34 it’s blue skies ahead. The more times Link tries to break its overhead resistance the weaker the resistance becomes.
Bears want to see Link continue to reject $39 and retrace to $34.87. If Link can’t hold that level of support, it could fall further to $29.58.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.