disclaimer: The following analysis results are the sole opinions of the authors and should not be construed as investment advice.
The $0.8 and $0.7 areas represent regions where Polygon’s native token, MATIC, has been in high demand in the past. The $0.65 area visited last July before rallying 330% to reach $2.93 in December.
It’s too early to say whether such an explosive rally could lead as the technical structure remained bearish on the chart. It may take some time to break this downtrend and the bulls will need strong demand for the bulls to rebound.
MATIC- 12 Hour Chart
On the chart you can see a steady decline in MATIC since December 2021. A rally was witnessed in mid-March, but the price quickly pushed below the $1.58 support level.
In May, the price fell below the $1.2 zone (red box), which served as a demand zone in September and October. MATIC also tested and confirmed this region as a supply region, dropping below the $1 level.
In the last few sessions, MATIC has rebounded from the $0.79 support level, forming a bullish candle. While these swepts indicate strong buying pressure, the question is, can the bulls really hold up in these bearish conditions?
Further south, below the $0.79 level is the $0.7 demand zone where MATIC has been rallying since July.
The RSI on the 12-hour chart has remained below the neutral 50 since the end of March. This means that momentum has been on the bearish side over the past six weeks and has indicated a bearish trend. For the past few days, the RSI has been consistently below 50.
At the same time, OBV has been on a steady decline since April, and sales have been dominant. This was especially true last week when OBV plummeted. However, the CMF, which had been on a steep decline a few days ago, rose again and crossed the zero line again. So there was an indication that there was buying pressure.
The Bollinger Bandwidth indicator formed a series of higher lows over the past week, indicating increased volatility over this period.
Indicators and trends indicated the continuation of the bearish trend. Volatility increased and selling pressure remained strong. Significant levels imminent are $0.8 support and $1 resistance, any level above which will determine the direction of MATIC in the next few days or weeks.