Polkadot (DOT) price fluctuates following 35% rally and 9% correction

Polkadot (DOT) experienced significant price volatility, following a 35% rally with a subsequent 9% decline. This movement has led market participants to debate whether the correction represents a loss of demand or a necessary leverage reset.

Data indicates that the decline involved substantial liquidations, with long liquidations reaching $892,620 over a 24-hour period, significantly outpacing short liquidations of $53,930. Despite the price drop, some indicators suggest a potential rebound. The Funding Rate, which had entered negative territory, shifted back to positive at 0.0037%, suggesting a shift in leveraged positioning toward buyers.

Additionally, spot market flows showed persistent withdrawals. DOT recorded a negative Spot Netflow of $1.13 million over 24 hours, with total outflows reaching approximately $14.33 million during that period. While such outflows can reduce available exchange supply, the overall market remains sensitive to whether these movements are driven by spot selling or the liquidation of futures contracts.