Polkadot: Here’s Why DOT Price Is About to Return to $7

• DOT market indicators suggest that the price could continue to rise with targets as high as $6.96.
• Capital has been pouring into the token and one analyst has predicted a breakout.

In a surprising turnaround, Polkadot (DOT) has emerged as the biggest gainer among the top 20 cryptocurrencies in the market. At press time, DOT was trading at $6.24, representing a 5.18% increase in the last 24 hours.

However, it doesn’t seem like the uptrend is going to stop anytime soon. This is based on the indications revealed by the liquidation heatmap. In simple terms, the liquidation heatmap predicts the price levels where large-scale liquidations could occur.

DOT is ready to be brought out of the woods

Liquidation occurs when an exchange closes a trader’s position due to increasing price fluctuations. It also occurs when the trader does not have enough funds to keep the position open.

But aside from that, the heatmap shows areas of high liquidity, which indicates price levels where a cryptocurrency could move. For Polkadot, AMBCrypto noticed that there was high liquidity between $6.45 and $6.96.

Source: Hyblock

Considering this data, if buying pressure increases, DOT price could build on its recent surge. If so, the token’s value could reach $7 or trade above the level.

Is an escape on the way?

Another indicator that supported this rise is weighted sentiment. As a broader view of social volume, weighted sentiment measures how the broader market perceives a project.

For example, if there are more positive comments than negative comments online, the reading will be positive. On the other hand, a higher number of negative comments will make the reading negative.

At press time, Polkadot’s weighted sentiment, which was previously at -0.143, has risen to 0.307. This reading signals growing confidence in DOT’s potential.

If this continues, it could lead to increased demand for the token. If so, DOT price could return to $7 in a few days from the time of writing. Like sentiment, Open Interest (OI) has supported a price increase.

Open interest refers to the sum of all open contracts in the derivatives market. When it increases, it means that net positioning is increasing. It also implies that traders are deploying capital to capitalize on DOT’s price movement.

However, a decline suggests that traders are withdrawing money and closing their positions. At press time, Polkadot’s open interest had risen to 133.35 million.

Source: Santiment

If this increase continues, it could lead to a further price increase that would take DOT to $7.

Additionally, some X analysts shared a similar view that the price of DOT could continue to rise. One of them is Captain Faibik.

Read Polkadot (DOT) Price Prediction 2024-2025

According to Faibik, DOT was close to a significant breakout. In his article on X, the analyst shared his thesis via a chart and specifically wrote:

“DOT has rebounded nicely and is about to break out of a corner, so keep an eye on it.”