Polkadot Has Crashed 15% Amid Massive Sell-Off Pressure

The spike began when Kraken added DOT to its exchange this week. The price climbed from $3.00 to $5.40 as trading volume picked up. DOT gained more than 200% over five days. Some of the momentum came from Polkadot's August 21 token redenomination, which cut the unit size by 100. The redenomination took effect at block 1,248,328.

The rally stalled Thursday. DOT dropped 15% in the previous 24 hours as sellers took over. Bittrex saw the token spike to $9.50 before dropping to $7.00. Both the daily and hourly charts show lower highs and higher lows, indicating traders have lost conviction. Bitcoin's struggle to hold above $11,500 support has weighed on the broader altcoin market. Bitcoin dipped as low as $11,100.

Technical signals suggest further downside. On the hourly chart, DOT has fallen beneath the 20-day and 10-day simple moving averages at $58.17 and $57.23. The RSI sits at 45.17, turned bearish. The MACD has formed a bearish divergence that could extend weakness through the next few trading sessions.

Support sits at $5.20. Below that, $4.70 offers the next line of defense. A break of $4.70 would set up sideways consolidation between $4.00 and $5.00. Polkadot has a $5.6 billion market cap, putting it sixth among cryptocurrencies. Bitcoin, Ethereum, Ripple, and ChainLink rank ahead of it.