Polkadot, an altcoin in the cryptocurrency market, has experienced minimal changes in its price on Monday amidst bearish sentiment in the overall market. As of now, Polkadot is trading at $5.08, representing a 7% decline over the past week. Over the course of the last three months, the altcoin has witnessed a 20% drop, while still maintaining a 17.87% increase in the year-to-date. Although its total market capitalization has increased by 1.97% in the last 24 hours, the trading volume of the asset has seen a significant surge of 20%.
The decline in Polkadot’s price can be attributed to the pressure imposed by macroeconomic factors on the cryptocurrency market. The global crypto market capitalization has now dropped to $1.18 trillion within the past 24 hours, while the overall crypto market volume has witnessed a 30% increase. Bitcoin and Ethereum, two leading cryptocurrencies, have also experienced slight decreases in their prices at the time of this writing.
In analyzing the sentiments driving the cryptocurrency market, it is important to consider the Crypto Fear and Greed Index. This index measures the emotions prevailing in the market and indicates a decline in confidence among investors. Within the past week, the index has shifted from a greed level of 63 to a neutral level of 57. The change in market sentiment can be attributed to uncertainty regarding the monetary policy path of the US Federal Reserve.
Market expectations currently reflect a 92% probability of the US Federal Reserve implementing a 25-basis point interest rate hike during its July meeting. The recently published meeting minutes of the Federal Open Market Committee (FOMC) revealed that the central bank intends to implement two more rate hikes within the year. In June, Federal Reserve Chair Jerome Powell expressed support for multiple rate hikes after the central bank had paused its campaign of rate hikes in June.
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Market participants are closely monitoring the US Consumer Price Index (CPI) for June, scheduled to be released on Wednesday, as well as the Producer Price Index (PPI) data on Thursday. Analysts anticipate a 0.3% increase in the monthly CPI for June, compared to 0.1% in the previous month. The annual CPI is projected to decline to 3.1% in June from May’s 4.0%.
Additionally, investors are eagerly awaiting the quarterly earnings reports of various banking giants this week. JP Morgan, BlackRock, Citigroup, and Wells Fargo are among the finance industry behemoths that will initiate the second quarter earnings season.
Examining the daily chart, it becomes apparent that Polkadot’s price has been subject to intense pressure in recent days. The digital asset is slightly below its 50-day and 200-day exponential moving averages. Furthermore, its Relative Strength Index (RSI) has fallen below the neutral zone, and the Moving Average Convergence Divergence (MACD) index remains bearish.
Based on these factors, it is likely that Polkadot’s price will continue to decline in the medium term, in line with the overall crypto market trend. If this scenario unfolds, the next support level to monitor will be at $4.85. Conversely, invalidation of the bearish thesis would occur if the price manages to surpass the major hurdle at $5.55.
In conclusion, Polkadot’s price has experienced minimal changes in the face of bearish sentiment prevailing in the crypto market. Macro factors, such as the US Federal Reserve’s interest rate hike plans and upcoming economic indicators, have contributed to the decline in confidence among investors. In the medium term, Polkadot’s price is expected to continue its downward trend, but a breakthrough above key resistance levels could alter the bearish trajectory.
