Polkadot hits a new all-time high above $54. Here is why

Numerous cryptocurrencies have reached new all-time highs in recent weeks, and Polkadot has just set a new one above $54.

Polkadot reached a new all-time high at $54.86 earlier today. The cryptocurrency’s price has surged by more than 6% over the past 24 hours to reach the new all-time high. At the time of writing, DOT is trading at $53.51, 2.8% down from the all-time high it reached earlier today.

Polkadot’s rally to a new all-time high is a result of the expected upgrade on the blockchain that will allow a parachain auction. A parachain is an individual blockchain hosted on the Polkadot network. Its auctions would allow DOT developers to register their projects on the parachain and generate funds for their projects once the governing Polkadot Council gives an idea its green light.

The Parachain upgrade will allow developers to generate funds to build their own use case within the Polkadot ecosystem. Due to the importance of this upgrade, DOT’s value has been appreciating in recent weeks, and the cryptocurrency reached a new all-time high earlier today.

Key levels to watch

The DOT/USD 4-hour chart is looking bullish at the moment as the cryptocurrency rallied by more than 30% over the past 24 hours. The MACD line is currently in the bullish arena, while the RSI of 68 shows that DOT is close to the overbought region.

Polkadot has set up a strong support level above its 100-day simple moving average (SMA) at $44, allowing the cryptocurrency to target higher prices over the next few hours.

What to watch out for

The DOT/USD pair could rally higher over the coming hours as traders and investors await the launch of the Parachain upgrade. DOT could rally towards its first resistance level at $59 over the coming hours if it maintains its recent momentum.

However, the cryptocurrency would need the support of the broader crypto market if it is to reach the $65 resistance point over the next few hours. In the event of a correction, DOT could defend the $45 support level unless there is an extended period of sell-off in the broader market.