# [NFA] Polkadot Analysis – $DOT By [3HOUSE](https://paragraph.com/@3house) · 2023-04-27 --- **Author: 3HOUSE user @0xBello** Fundamental ----------- DOT, also known as Polkadot; is a decentralized blockchain network that allows interoperability between different blockchains. It was founded by Dr. Gavin Wood, one of the co-founders of Ethereum, in 2016. Polkadot has quickly gained attention and popularity among the cryptocurrency community due to its unique features and potential use cases. One of the main advantages of Polkadot is its ability to connect multiple blockchains, creating a seamless network that allows for faster and more efficient transactions. This is accomplished through the use of "parachains," which are independent blockchains that can connect to the Polkadot network. Parachains allow for interoperability between different blockchains, allowing them to communicate and share data with each other. Another unique feature of Polkadot is its governance system. Unlike many other blockchain networks, Polkadot is designed to be fully decentralized and community driven. This means that decisions about the direction and development of the network are made by the community, rather than a central authority or group of individuals. The DOT token is the native cryptocurrency of the Polkadot network. It is used for a variety of purposes including staking, governance and transaction fees. Staking DOT allows users to participate in the network's consensus mechanism and earn rewards in return. DOT holders also have the ability to vote on proposals and decisions related to the network's development. Since its launch, Polkadot has seen significant growth in both adoption and market value. As of April 2023, Polkadot is the ninth largest cryptocurrency by market cap, with a valuation of over $60 billion. This is a testament to the potential of the network and the confidence that investors have in its ability to deliver on its promises. One potential use case for Polkadot is in the field of decentralized finance (DeFi). DeFi has become increasingly popular in recent years, and many blockchain networks have launched their own DeFi platforms. However, the fragmented nature of the DeFi ecosystem can make it difficult for different platforms to communicate and work together. Polkadot's interoperability features could help to solve this problem, allowing for easier communication and collaboration between different DeFi platforms. In conclusion, Polkadot is a decentralized blockchain network that offers unique features and potential use cases. Its ability to connect multiple blockchains and its community-driven governance system set it apart from other blockchain networks. The DOT token plays a vital role in the network's ecosystem, and its growth and adoption have been impressive in a relatively short period of time. As blockchain technology continues to evolve, it will be interesting to see how Polkadot develops and how it contributes to the overall blockchain ecosystem. Technical analysis ------------------ I will start by looking at the overall market. BTC this week, has broken down to the 27k range. It has then had a huge impulse back up, breaking above the 29k range. Lots of people got caught longing BTC when we retested the 29k level previously. However, lots of people \[Twitter\] are calling for 10K BTC looking at the daily chart. Right now, it seems price invalidated their structure playouts; as we pumped back up above the 29k level. We want to look for a break above the High of 31K next in my opinion. ![](https://storage.googleapis.com/papyrus_images/eec32fe4ec13477f77a7f4fa5a959814da3f84a61c6b9e63ffe2a3e31c106fc1.png) If we fail to break the 31K high, we will return down to the lows of 25k in order to grab the required liquidity to push us through the 31k range. This is where liquidity is resting as of now and where large investors or whales will look to accumulate; potentially even lower. They will control the markets to do what they want, the goal is not to beat the market but move with it, by catching a trend. Once we get a clear idea, we can see how the rest of the week will play out; but for now, the next target for us is to break above the 31k price range and grab the liquidity that lies above. Next, I will look at SPY (S&P 500). As expected, we saw a rejection of the $416 level. However, we only saw a minor rejection and this week I expect us to be bullish once again and approach the $418 level. We recently saw price break out of the wedge we had been in for months; price will want to approach the high of the wedge once again. Not soon, but in future. So, a break of the $418 level will be very bullish for us. ![](https://storage.googleapis.com/papyrus_images/cb5937255254b16777978e2c320f824413bed44bda9b79298685899851d17c15.png) ### DOT analysis Looking at the 12H chart, we can see a bullish opportunity present itself. We would look to get into a long position at $5.963 with our stop loss at $5.768 (3%). I am using this 12H FVG to get an entry in this trade because we will see a little squeeze down before going any further upwards. I'm expecting a little pull back that’s all, a very simple entry model! We would look to take profits along the way with TP1 being at $6.157, the second TP being at $6.339 and finally the third TP being at $6.950. These take profit levels create a lovely R:R for this trade. ![](https://storage.googleapis.com/papyrus_images/c676cb1673487bf252a24cb1115b9315683916a7ee8ce6a9d6fe86ee988b2f9e.png) Buy zone - $5.963 Stop loss - $5.768 (3%) TPs - $6.157 / $6.339 / $6.950 Next, we will look at a short opportunity. Entry for the short trade will be $6.309 with a stop loss at $6.434 (2%). Im looking to enter at the beginning of the OB on this 12H chart. Again, a very simple entry model and we will look to take profits along the way with TP1 being at $6.211, the second take profit will be $5.972; third take profit at $5.768 and the finally take profit being at $5.150. These take profit levels create another lovely R:R for the trade! ![](https://storage.googleapis.com/papyrus_images/4d99cb752bc6a0b289b483e277b28fbd64076bac805fb4eb8b82f0b9cb5b6801.png) Buy zone - $6.309 Stop loss - $6.434 (2%) TPs - $6.211 / $5.972 / $5.768 ### Summary: In conclusion, Polkadot (DOT) is a cryptocurrency that has emerged as a promising platform for decentralized applications and interoperability between different blockchain networks. Its unique features, such as the ability to connect different chains in a secure and scalable way, have drawn the attention of developers and investors alike. While the cryptocurrency market can be volatile, the long-term potential of Polkadot as a network and a cryptocurrency is worth considering. As more projects and users join the ecosystem, we can expect to see continued growth and innovation in the space. As always, it's important to do your own research and consider your investment goals and risk tolerance before making any decisions. This is not trading advice and any actions taken based on this information are solely at the readers discretion. We do not make any guarantees or warranties about the completeness, reliability or accuracy of this information. We encourage readers to do their own research before entering the market. ![](https://storage.googleapis.com/papyrus_images/1c14836ba8330bf392959d5bd8f327d42bfc1ea87c8d26bcabadaf15ff920e1e.png) --- *Originally published on [3HOUSE](https://paragraph.com/@3house/nfa-polkadot-analysis-dot)*