Polkadot (DOT) Breaks Out with 2x Target as Token Unlock Looms

• DOT breakout targets $12 if support holds above $4.05 level.
• Token unlock may cause volatility despite a low percentage of supply.

Polkadot (DOT) has broken out of a prolonged falling wedge, indicating a possible trend reversal. Market analyst Captain Faibik analysed that DOT has officially broken above its falling wedge pattern, supported by strong bullish volume. 

The pattern had constrained price movement for several months. The breakout now opens the door for a potential 2x move, with projected targets reaching up to $12 if momentum continues.

The daily chart confirms a clean breakout above descending resistance, suggesting a change in long-term market structure. Traders are closely monitoring price action for confirmation, including support retests and sustained volume. 

The breakout has also aligned with broader bullish activity in the altcoin sector, further reinforcing the potential for upside.

Bullish Structure Forms at Key Support Levels

DOT is trading near $4.10 on the 1-hour chart, after pulling back slightly from a local high of $4.19. Technical analysts note that the asset has formed a bullish flag following its breakout, which could lead to another leg upward if support holds.

The $4.05 zone is now acting as a key level, flipping from resistance to support. Analysts see a favorable risk-to-reward setup, with upside targets at $4.14 and $4.19. If DOT holds above $4.05, buyers may gain control, contingent on overall market strength and trading volume.

$9.39M DOT Token Unlock May Add Short-Term Pressure

Polkadot is set to release 2.30 million DOT tokens between July 14 and July 21. According to tokenomist data, the unlocked amount represents about 0.15% of the current supply, with a market value of approximately $9.39 million.

Although the percentage of new tokens is relatively small, unlock events often create short-term volatility. Traders will be watching closely for potential sell pressure or market shifts as the additional supply enters circulation.

This unlock coincides with over $1.57 billion in scheduled token releases across the crypto market during the same period.

Market participants are now balancing bullish technical setups with the possible effects of this token release. The combination of a breakout pattern, short-term support tests, and supply increases makes this week critical for DOT’s price trajectory.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.