Polkadot and his parachains have carved out a niche for themselves in the DeFi space, together worth $1.31 billion.
And looking at the investor reaction to these parachains, it seems that their auction will play a major role in pulling Polkadot out of its price drop.
Go once, go twice and…
Efinity, the winner of the sixth parachain in the second round of parachain auctions, is scheduled for March 11 aboard Enjin.
With three days to go, Polkadot is already showing some bullishness. Even so, with the broader market still in a state of apprehension, prices have also been more or less consolidated for a while.
Development wise, Polkadot is looking at the next parachain auction which ends in 2 days and which, it looks like, will be won by Nodle.
Nodle is described as a crowdsourced, decentralized Internet of Things (IoT) network. It plans to use Bluetooth Low Energy (BLE) across millions of smartphones and routers to enable businesses and smart cities to connect IoT devices to the Internet.
Voters seem to appreciate the potential implications of this project, leading to strong support for it. Its closest competitor was the cross-chain money market Equilibrium.
All in all, with Nodle looking for the next auction by March 11, DOT prices already seem to be improving. For example, the Squeeze Momentum Indicator showed the first green bar in more than two weeks.
Additionally, with the ADX climbing above 25.0, the active trend could see more strength, provided the trend turns into an uptrend.
Polkadot price promotion | Source: TradingView – AMBCrypto
In fact, there is a real possibility of a recovery beyond just positive price indicators as investor sentiment is now at its best since the December crash.
Once the same turns positive, the possibility of a rally/recovery would increase.
Polkadot investor sentiment | Source: Santiment – AMBCrypto
However, to attract investors again, Polkadot will have to show some durability. Currently, Polkadot’s market value is stuck below the bearish zone below 1.0. Also, returns on investments are negative beyond acceptance.
Ergo, once that changes, Polkadot may be in a significantly better position on the price charts.
Polkadot return on investment | Source: Coinmetrics – AMBCrypto
This post Why Polkadot’s recovery only depends on this stat’s three-month high
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