Polkadot’s DOT has witnessed a surge in trading activity over the past few days. Since last weekend, the altcoin has posted modest but consistent gains.

This move has been largely driven by renewed optimism surrounding pending regulatory decisions on DOT-backed exchange-traded funds (ETFs) in the United States. With one of those decisions expected to come on June 11, DOT is seeing a notable rise in demand among market participants.  

Polkadot Gathers Steam as ETF Decision Looms

Investor sentiment around DOT has grown increasingly bullish as the US Securities and Exchange Commission (SEC) prepares to issue its final rulings on two major ETF applications this month. 

According to a SEC filing dated April 24, the first decision, regarding Grayscale’s Polkadot ETF proposal, is expected on June 11, while a ruling on 21Shares’ Polkadot ETF is scheduled for June 24.

DOT is gaining steam ahead of the June 11 decision, with traders betting on a favorable outcome. 

This growing optimism is reflected in DOT’s price action, as it edges closer to its 20-day exponential moving average (EMA), a key indicator that signals a shift in momentum. At press time, DOT trades just below this key level, with mounting bullish pressure suggesting a potential breakout to the upside.

The 20-day EMA measures an asset’s average trading price over the past 20 days, placing greater weight on recent price movements. When an asset’s price breaks above the EMA, it is a bullish signal indicating that buyers are gaining control and a near-term uptrend may be forming. 

For DOT, a sustained move above this level could confirm the growing bullish sentiment and trigger further upward momentum.

Additionally, the coin’s funding rate across derivatives exchanges remains positive, suggesting that long-position holders are willing to pay a premium, another sign of growing confidence ahead of tomorrow’s decision. At press time, the metric sits at 0.0093%, per Coinglass.

The funding rate is a periodic fee between long and short traders in perpetual futures markets. It keeps contract prices aligned with the spot market. A positive funding rate indicates that long traders are paying shorts. This suggests bullish market sentiment and a higher demand for long positions.

DOT Rally Gathers Steam, But SEC Ruling Could Be a Game-Changer

DOT trades at $4.11 at press time, recording a 3% price gain over the past day. During that period, its daily trading volume has soared 76% to $230 million, highlighting strong investor demand behind the rally.

When an asset’s price and trading volume rise simultaneously, it shows strong market interest. It also confirms the strength of the price move. This combination suggests that DOT’s uptrend is backed by demand and may have further momentum.

In this scenario, DOT could break the resistance at $4.13 and climb to $4.37.

However, an unfavorable SEC decision tomorrow could shake investor confidence and spark sell-offs. This could drive DOT’s price down toward the $3.96 level.