Polkadot’s (DOT) price action was affected by its failed breakout attempt from a wedge pattern, which has been in place for the past 7 weeks. The altcoin had demonstrated support at the $6 price level and had previously shown a descending resistance line limiting the upper bounds of its trend.
After a mid-week breakout from this resistance trend, DOT’s price surged but was short-lived, pulling back by 12% over the last two days to reach its current price of $6.61. This pullback underlined the lack of strong enough demand to support significant upside.
However, recent market activity has shown a return of excitement in some altcoins and positive liquidity flows. DOT’s discounted price presented an opportunity for buyers to get in closer to the support level. A strong comeback will likely be underpinned by renewed interest among traders and investors.
Recent address activity and Open Interest data suggest that a significant number of holders have been anticipating a bounceback from the support range. Active accounts bounced back to a recent high on January 17, while new addresses grew significantly over the last two days.
Despite this, liquidation data revealed that relatively low funds were allocated to leveraged long positions in DOT. This may encourage accumulation, but for now, the data suggests that DOT has not been receiving much attention from traders.
Source: https://ambcrypto.com/can-fomo-help-dots-price-action-after-its-failed-breakout-attempt