Polkadot Drops 50% to $3.75 Support Zone

Polkadot (DOT) has returned to a critical support zone at $3.75, a level not seen since October 2023. This zone is significant as it represents a major structural point where buyers have historically stepped in, potentially marking the beginning of a broader reversal. The broader price structure suggests that DOT is cycling within a larger range, and a confirmed reclaim of this support zone could indicate a shift in market dynamics.

The $3.75 region is more than just a psychological level; it is a multi-month value area low and aligns with the point of control for DOT’s price action dating back to October 2023. This triple confluence zone makes it a major area of interest, where buyers have historically reversed trend momentum. The return of DOT to this level gives technical traders a potential opportunity to observe a significant macro low forming.

Price action has been in a relentless downtrend since printing its swing high. While there was a local high formed in an attempted bounce, the entire move was retraced, highlighting continued bearish pressure. Now, however, DOT is testing the very base of its high time frame trading range, where price historically pivots and begins a new cycle back toward the range highs.

For bullish continuation to be confirmed, a shift in market structure is necessary. Currently, DOT is still forming lower lows and lower highs. A reversal scenario would require the price to reclaim the $3.75 level decisively, take out the local high, and then print a higher low. This would indicate a break in bearish structure and confirm demand in the zone. Only then can a rotation toward the $7.67 resistance level, the upper boundary of the larger range, be expected with any conviction.

The current zone can also be interpreted as a deviation below value, particularly if price action quickly reclaims the point of control and confirms the move with increased volume. Such a deviation would suggest a bear trap at the range lows and open the probability for a sharp rally fueled by short covering and fresh accumulation.

If DOT confirms support above $3.75 and breaks above the recent local high, a larger reversal toward $7.67 could begin. Until then, price action remains range-bound, and traders should monitor closely for a shift in market structure.