Polkadot price was in the red earlier on Monday, breaking its three-day rally as investors digested the latest developments in the US debt ceiling deal. At the time of writing, DOT was trading more than 1% lower at $5.44. Polkadot’s total market cap, as well as its total volume, have dipped over the last day. DOT ranks as the 13th largest cryptocurrency after Litecoin.
Polkadot price has been trading sideways for the past few days amid recent market volatility in the cryptocurrency market. Even so, the asset managed to jump 3% in the past week and remains 26.22% higher in the year to date. DOT has a total market cap of $6.47 billion.
Most cryptocurrencies have been in consolidation mode for the past few days, characterized by a mix of gains and losses in the prices of the assets. This was brought about by the tension around the uncertainty of the US debt ceiling deal and an unprecedented default of the US government.
US President Joe Biden finalized a budget agreement with House Speaker Kevin McCarthy to suspend the $31.4 trillion debt ceiling until 2025, allowing the government to keep borrowing money and pay its bills on time. Even so, Congress must pass the agreement before June 5 for that to happen.
The US dollar briefly touched a six-month high against the Japanese Yen on Monday before pulling back. However, the greenback seems to remain firm as economic resilience in the US raised market expectations for further hikes in the Federal Reserve’s funds rates. Focus is now on the CB Consumer Confidence data for May slated for Tuesday as analysts forecast a decline to 99.
Polkadot Price Outlook
Polkadot share price has been trading between the tight range of $5.45 and $5.20 for the past few days amid increased market volatility. The asset has remained below the 50-day and 100-day exponential moving averages (EMA), as well as the 50-day and 100-day simple moving averages (SMA), as highlighted on the daily chart. Its Relative Strength Index (RSI) has inched lower but remains above the signal line.
Consequently, the Polkadot price is likely to continue falling in the short term before initiating a price correction to the upside. As such, a move past the 50-day EMA at $5.65 will give bulls the potential to push the price higher to $5.85. Conversely, a flip below the crucial support level at $5.15 will invalidate the cautiously bullish thesis.