Polkadot price rebounds 11% – Can DOT extend its rally to $1.75?
Key Summary
Polkadot price has rebounded 11% to $1.27 after a 54% reduction in annual token issuance and the launch of a native stablecoin, sparking hopes of a sustained rally to $1.75. The token's increasing open interest and longs dominance suggest continued trader participation. However, the token's price recovery is still uncertain and may face renewed selling pressure if it fails to hold above its key EMA support.
Polkadot price surges 11% after 54% reduction in token issuance and native stablecoin launch
Market Analysis
Polkadot's price has shown significant improvement in the past 24 hours, rebounding 10.93% to $1.27. This move comes after the token's price action rebounded from key EMA support at around $1.02. The bullish advances follow a 54% reduction in annual token issuance and the launch of a native stablecoin, which could strengthen the network's long-term outlook.\ \ \ \
Tokenomics
The reduction in annual token issuance marks a significant shift in Polkadot's tokenomics. Fewer new tokens entering circulation equates to reduced selling pressure. Its circulating supply currently ranks 36th among the L1 tokens. The launch of a native stablecoin could expand activity across the ecosystem. Stablecoins support payments, decentralized finance (DeFi) applications, and liquidity, potentially creating new use cases for Polkadot.\ \ \ \
Derivatives Activity
Zooming down to the Polkadot's derivative data, its OI has increased 15% to $78 million as of writing, suggesting traders are opening new positions as the token advances. Notably, long accounts now represent 73% of total leveraged positions, according to the recent Polkadot's Long/Short data, suggesting that most traders and investors are betting on further gains for the token.\ \ \ \
Technical Analysis
On the daily chart, DOT has rebounded from support near $1.02 to reach $1.27, marking a notable improvement in its short-term structure. Besides, the token is now trading above all its key EMA support, pointing to potential buyer dominance continuation in the short run. Holding above reclaimed support could strengthen the case for further gains, while renewed selling could expose the token to another test of lower levels.