Polkadot (DOT) price breaks higher to target $5+ levels

Polkadot (DOT) price has broken out of its range this week to trade over 10% in the green on a weekly basis. In the meantime, the platform is collaborating with Ontology (ONT) in an effort to boost the adoption of decentralized identity solutions.

Fundamental analysis: ONT partnership

Polkadot, on which Ontology plans to develop applications, is a sharded blockchain that can perfectly link a number of chains within a single network. According to the official announcement, Ontology and Polkadot will be collaborating to “accelerate the integration of both ecosystems and increase levels of trust and data sovereignty for users across the industry.”

Polkadot supporter Parity Technologies will be helping Ontology during the integration of its Decentralized Identity (DeID) solution, which is meant to facilitate the process of accessing the DID solution within the Polkadot blockchain.

Moreover, the parachain will also offer cross-chain liquidity to the Polkadot ecosystem, which Ontology will use to speed up the current development of the decentralized finance (DeFi) ecosystem while diminishing the entry barrier for app developers.

Initiatives such as this one aim to “in turn boost the liquidity of digital assets such as ONT, ONG and DOT,” Ontology explained. 

The blockchain team also said it plans to place offers on a parachain slot as well as roll out one of Polkadot’s first Initial Parachain Offerings (IPO).

Technical analysis: The breakout confirmed

DOT/USD has been testing the descending trend line near $4.34 in the past week before managing to close above it on Saturday. The buyers then returned lower to retest the broken resistance and allow for new DOT buyers to join and push the price action towards a new 5-week high at $4.93. 

As it can be seen on the chart above, the price action stopped at the horizontal resistance near $4.90. A break of this line paves the way for a trip above the $5 mark where sellers would use $5.12 to regroup and cap new gains.  

Summary

DOT/USD price broke out above its prior range to trade over 10% higher this week. Elsewhere, Ontology blockchain is working together with Polkadot to expedite the development of decentralized ID solutions.