Polkadot Price is Set to Pullback Further Ahead of Key Inflation Data

Polkadot price was barely unchanged on Monday amid bearish sentiment in the crypto market. At the time of writing, DOT was trading at $5.08 after falling more than 7% in the past week. The altcoin is down by nearly 20% in the past three months but has remained 17.87% higher in the year to date. Its total market cap has increased by 1.97% over the last day, while the total volume of the asset traded jumped by 20%.

Fundamentals

Polkadot price has been under intense pressure for the past few days as macroeconomic factors continue to weigh on the cryptocurrency market. The global crypto market cap has slipped to $1.18 trillion in the past 24 hours, while the total crypto market volume increased by 30%. Crypto heavyweights, Bitcoin and Ethereum, were also trading slightly lower at press time.

The Crypto Fear and Greed Index, which measures the emotions driving the cryptocurrency market, indicates a decline in confidence among investors. The index has declined from a greed level of 63 to a neutral level of 57 in the past week. The shift in the crypto market sentiment has been due to market uncertainty around the Fed’s monetary policy path.

Markets are pricing in a 92% chance that the US Federal Reserve will hike its interest rates by a 25-basis point in its July meeting. According to the meeting minutes published by the Federal Open Market Committee (FOMC) last week, the central bank is likely to implement two more hikes this year. Earlier in June, Fed Chair, Jerome Powell, signaled his support for multiple rate hikes this year after the central bank paused its hike campaign in June.

Markets are eyeing the US Consumer Price Index (CPI) for June slated for Wednesday, followed by the Producer Price Index (PPI) data on Thursday. Analysts expect the monthly CPI for June to increase by 0.3%, up from 0.1% in the previous month. The annual CPI is expected to decline to 3.1% in June, down from 4.0% in May.

Investors will also be on the lookout for a slew of banking quarterly earnings this week. Finance bigwigs, including JP Morgan, BlackRock, Citigroup, and Wells Fargo, will kick off the second quarter earnings season this week.

Polkadot Price Prediction

The daily chart shows that the Polkadot price has been under intense pressure for the past few days. The digital asset remains slightly below the 50-day and 200-day exponential moving averages. Its Relative Strength Index (RSI) has slipped below the neutral zone, while the Moving Average Convergence Divergence (MACD) index remains bearish.

As such, the Polkadot price is likely to continue falling in the medium term, in tandem with the global crypto market. if this happens, the next support level to watch will be $4.85. Conversely, a flip above the major hurdle at $5.55 will invalidate the bearish thesis.

DOT Price Chart