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Polygon (MATIC) Price Poised to Surpass $1, Pending Key Breakout

2 mins
Updated by Ryan Boltman
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In Brief

  • The Polygon (MATIC) price has increased since June 10. It broke out from a descending resistance line on July 10.
  • While the daily time frame readings indicate that the trend is bullish, short-term readings contradict that and suggest that the trend is bearish instead.
  • Whether the price breaks out or down from the $0.74 resistance area will be key in determining the future trend's direction.
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The Polygon (MATIC) price broke out from a 140-day resistance line but has not followed the breakout with a significant upward movement.

Long- and short-term readings are not in agreement with each other. While the daily time frame shows a decisive breakout, the short-term outlook suggests a breakdown will occur instead.

Polygon Price Breaks Out From 140-Day Resistance

The daily time frame technical analysis for MATIC gives a bullish outlook. The main reason for this is the fact that the price broke out from a descending resistance line that had been in place for 140 days.

Breakouts from such long-term levels mean that the previous movement is done, and a new one has begun in the other direction.

Despite the breakout, MATIC has now yet initiated a significant upward movement. Rather, it trades very close to its pre-breakout level.

Polygon (MATIC) Price Movement
MATIC/USDT Daily Chart. Source: TradingView

The weekly Relative Strength Index (RSI) is also bullish, legitimizing the breakout. With the RSI as a momentum indicator, traders can determine whether a market is overbought or oversold and decide whether to accumulate or sell an asset.

Bulls have an advantage if the RSI reading is above 50 and the trend is upward, but if the reading is below 50, the opposite is true. The RSI is below 50 (red icon) and declining, indicating a downward trend.

The indicator moved above 50 when the price broke out from the line. Therefore, it supports the possibility that the MATIC price has begun a new bullish trend.

MATIC Price Prediction: Key Level Determines Trend’s Direction

While the daily time frame is decisively bullish, the short-term six-hour time frame casts some doubt on the legitimacy of the previous breakout.

While the MATIC price has increased since June 10, it has done so inside an ascending parallel channel. This is considered a bearish pattern, meaning that an eventual breakdown from it is likely.

Furthermore, the MATIC price was rejected by a confluence of resistance levels (red circle) on July 12. The channel’s resistance line and the 0.5 Fib retracement resistance level create the resistance.

The principle behind Fibonacci retracement levels suggests that after a considerable price movement in one direction, the price will return partially to a previous price level. So, the failure to move above 0.5 Fib suggests that the upward movement is corrective, and a breakdown will occur.

If the MATIC price breaks down from the channel, it will likely fall to its June 10 lows at $0.51.

Polygon (MATIC) Price Prediction
MATIC/USDT Six-Hour Chart. Source: TradingView

Despite this bearish short-term MATIC price prediction, a breakout from the $0.74 resistance area and the channel will mean that the trend is bullish. The MATIC price can move to the closest resistance at $0.90 in that case.

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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