Will the MATIC bull have enough muscle to challenge the current bearish structure?


Disclaimer: The results of the following analysis are the sole opinions of the authors and should not be construed as investment advice.

Polygon (MATIC) bearish after gliding near the $1.3 threshold for more than three months resonated with fear sentiment across the market. As a result, the coin defied the buying trend last month by urging a massive sell-off.

A comfortable closing above the control point (POC, red) positions MATIC for testing at the 23.6% Fibonacci level, with buyers eager to reject the lower price. At press time, alt was trading at $0.688, up 3.57% in the last 24 hours.

MATIC daily chart

Source: TradingView, MATIC/USDT

The early April reversal at $1.7 reaffirmed the sell as MATIC fell below the baseline (green, 20 SMA) of the Bollinger Bands (BB). Having lost more than 70% since April 4, MATIC plunged to a one-year low on May 12. During the descent, the 38.2% and 23.6% Fibonacci levels presented significant recovery obstacles.

However, the seller has taken over noticeably as the bear has held Alt towards the lower band of BB over the past 47 days. Along with several bearish candlesticks, MATIC saw a compressed daily bearish pennant near the POC.

Closing below the POC increases the likelihood of a move below the pattern. In this case, MATIC aims to retest the robustness of the $0.6 zone support. If the bulls find an upward escape from the pennant’s bond, we could see the alt test the resistance of the BB basis line before continuing the uptrend.

rationale

Capture 50 scaled

Source: TradingView, MATIC/USDT

The RSI has seen a much-needed recovery from oversold highs and lows over the past few days. A potential reversal in immediate trendline resistance could confirm bearish divergence with the price.

Also, CMF tends to be bearish. A decline from the -0.8 level despite the recent uptrend will result in bearish divergence. Despite this, AO’s selling pressure has gradually eased. A higher peak below the zero line could result in a bullish twin peak setting.

conclusion

While entering a currency, it may not yet be profitable as it corresponds to betting on a dominant trend. Buyers could wait to close above the 23.6% level, followed by a basis line that could benefit from a potential bull market.

MATIC also shares an astonishing 30-day correlation of 97% with King coin, so investors/traders should keep a close eye on Bitcoin’s movements.

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