Polkadot price has been under intense pressure for the past few days amid the recent bearish sentiment in the crypto market. At the time of writing, DOT was barely unchanged, trading at $5.351. The altcoin has dipped more than 25% for the past month but remains 24.23% higher in the year to date. The asset’s total market cap has slipped over the last day to $6.343 billion, ranking it the 13^th largest cryptocurrency.

Is the Worst Yet to Come?

Polkadot price has been consolidating for the past few days amid the recent sell-off in the crypto market. Statistics by Coinmarketcap show that the global crypto market cap has dropped 1.29% over the last day to $1.13 trillion, while the total crypto market volume decreased by nearly 7%.

The biggest cryptocurrencies, Bitcoin and Ethereum, have been in a freefall for the past few days, falling to $26,880 and $1,807, respectively. Most altcoins, including BNB, Cardano, Solana, Shiba Inu, and Avalanche, have plunged seeing that most altcoins move in tandem with the performance of heavyweights Bitcoin and Ethereum.

Looking ahead at the global market mayhem with the US debt ceiling debate and the US banking crisis, investors expect more downside in the crypto market. The US dollar has continued growing stronger, hovering around a six-month high against the Yen, as optimism around the US debt ceiling talks in Washington raised expectations of higher-for-longer interest rates.

Two Fed policymakers, including Dallas Federal Reserve President Lorie Logan, said on Thursday that the US inflation does not seem to be cooling at the expected rate to allow the Fed to pause its interest rate hike campaign. Traders are pricing in a 20% chance the Fed will hike interest rates in its June meeting.

Additionally, the European Central Bank (ECB) also said that it remains committed to achieving its 2% goal, hence will continue raising its interest rates until the guidance is met. An environment of hiked interest rates is mostly bearish for risk assets such as stocks and cryptocurrencies.

Polkadot Price Outlook

Polkadot price has been consolidating in recent trading sessions, trading between the tight range of $5.10 and $5.50. The DOT price has remained below the 50-day and 200-day exponential moving averages, as well as the 50-day and 100-day simple moving averages. Its Relative Strength Index (RSI) is below the neutral zone, exhibiting a bearish outlook.

Therefore, I am rather neutral on the asset with a bearish inclination. I expect the Polkadot price to continue consolidating in the immediate term as technicals set the pace. A move below the crucial support level at $5.00 will give bears a chance to retest the next support at $4.560. On the flip side, we cannot rule out a bullish breakout past the 50-day EMA at 5.799.

DOT Price Chart