Polkadot price is holding the strong $20 – $21 support area. However, the DOT bulls are struggling to move past this area.

DOT has a chance to hit $30 and up

The DOT price action is preparing for some bullishness on its daily Ichimoku chart. Despite a strong recovery that still lags the competition, this underperformance could soon be over.

A buy stop on the daily Kijun-Sen at $22.5 would be a hypothetical entry for a long opportunity. The stop loss is $20 and the profit target is the 38.2% Fib at $31. However, the note on this trade setup is that the entry should only be made at the close of the daily candle, so $22.5 – $23.50 would be the appropriate entry zone.

The trade setup has a reward to risk ratio of 3.4:1 with an implied profit target of 40% from entry. The $2 stop after the DOT price hits $25 helps protect any profits made after entry.

DOT/USD daily chart Ichimoku Kinko Hyo. Source: TradingView

Downside risk remains but should be appropriately contained. Tenkan-Sen at $20.5 is a critical support area for DOT to hold. A daily close below this level could result in massive selling pressure and a continuation of the downtrend. If so, Polkadot will likely return to test the 2022 lows with a high probability of a break below those lows.

Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

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