Can DOT push higher after reaching a one-month peak?
Over the past 24 hours, the cryptocurrency market staged a solid rebound, with many leading digital assets showing renewed momentum and reclaiming some of their recent losses.
Polkadot (DOT) is among the top performers today (February 26), jumping by roughly 22%.
The Upcoming Halving and More
Polkadot’s native token, which was one of the major cryptocurrencies in 2021 when its price rocketed above $50, has been on a severe decline over the last several months, crashing to a local bottom of $1.15 at the beginning of February.
Over the past day, though, it posted a strong comeback, with its valuation reaching a monthly high of approximately $1.74. Its market capitalization soared past $2.6 billion, making it the 36th largest cryptocurrency.
The broader market resurgence, marked by Bitcoin (BTC) nearing $70,000 and Ethereum (ETH) reclaiming the $2,000 psychological level, seems to be the most likely catalyst driving DOT’s price higher. However, some analysts claimed that other factors could have contributed to the upswing as well.
Lark Davis, who has almost 1.5 million followers on X, argued that Polkadot’s upcoming halving might be one such reason. He said the event, scheduled for March 14, will slash annual token issuance by 50%, claiming “the scarcity narrative is driving strong bullish sentiment.”
Another potential driver, as noted by Davis, is the growing anticipation surrounding prospective spot DOT ETFs, which prominent companies like Grayscale and 21Shares have expressed interest in launching.
These products (should they be approved by regulators) will allow investors to gain exposure to Polkadot’s native cryptocurrency through brokerage accounts without holding the token directly. This simplified access can attract more market participants, whereas increased demand could lead to upward price pressure on the asset.
The regulatory climate in the US has shifted towards a more favorable stance on crypto products, with multiple spot ETFs debuting over the past several months. This signals that a similar investment vehicle having DOT as the underlying token may also go live soon.
Davis did not stop there and offered a third possible reason for the asset’s recent revival. He suggested that DOT “broke above the daily 20 EMA and horizontal resistance at around $1.40+, while holding firm support at $1.23, a setup that could have triggered momentum buyers.”
The Next Targets
The resurgence has naturally sparked a fresh wave of enthusiasm among analysts and traders, some of whom believe DOT has more fuel left to chart further gains.
X user RACHEL CRYPTO predicted the price could rise to $1.80, while prior to that, Crypto GVR envisioned an ascent to $2-$3 in the long term.
At the same time, the asset’s Relative Strength Index (RSI) should serve as a warning. The technical analysis tool measures the speed and magnitude of recent price changes and can help identify potential price reversals. It ranges from 0 to 100, where ratios below 30 indicate that DOT is oversold and due for a potential pump, while readings above 70 are interpreted as bearish territory. Currently, the RSI stands at around 73.
Disclaimer: CryptoPotato has received a grant from the Polkadot Foundation to produce content about the Polkadot ecosystem. While the Foundation supports our coverage, we maintain full editorial independence and control over the content we publish.
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