See More

Polygon (MATIC) Road to Recovery: Is a Potential 60% Gain Ahead?

2 mins
Updated by Ryan Boltman
Join our Trading Community on Telegram

In Brief

  • The Polygon (MATIC) price is decreasing under a long-term descending resistance line. The price also fell below a crucial horizontal support area.
  • While the daily timeframe price action is bearish, the six-hour one is bullish. Furthermore, the daily RSI has generated bullish divergence.
  • Whether the price breaks out from the long-term resistance line or gets rejected will determine the future trend's direction. A 60% increase could occur in case of a breakout.
  • promo

The Polygon (MATIC) price broke out from a short-term descending wedge and is attempting to clear a long-term descending resistance line.

Doing so could lead to a significant price increase, while a rejection from the line will likely catalyze a drop toward the closest horizontal support area.

Polygon Price Struggles Below Resistance

The technical analysis in the daily timeframe for MATIC shows that the price has fallen under a descending resistance line since February 28, when it reached its yearly high of $1.57.

While following the line, the price decreased from the $0.60 horizontal support area. Then, it validated the area as resistance on August 29 (red icon).

The validation simultaneously touched the descending resistance line for the final time, another sign of a bearish trend. The price has not reached the line since.

If the MATIC price breaks out from the line, it can increase by 60% and reach the $0.85 horizontal resistance area. However, if it gets rejected again, a 35% drop to the closest support at $0.35 will likely be the future movement.

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

Even though the price action is bearish, the daily Relative Strength Index (RSI) gives signs of a potential bullish trend reversal.

Traders use the RSI as a momentum gauge to identify whether a market is overbought or oversold. This aids them in making decisions regarding asset accumulation or liquidation. An RSI reading above 50 during an upward trend provides an advantage to bulls. While a reading below 50 implies the opposite scenario.

While the indicator is still below 50, it is increasing. More importantly, it has generated significant bullish divergence (green line). This occurs when a momentum increase accompanies a price decrease.

It often leads to bullish trend reversals. In the case of MATIC, it would be expected to cause a breakout from the long-term descending resistance line.

The bankrupt FTX exchange posted a list of assets that were approved for liquidation, and MATIC was not among them.

MATIC Price Prediction: Will Short-Term Breakout Catalyze Increase?

A look at the shorter-term six-hour timeframe suggests that the price will successfully break out from the long-term resistance line. The main reason for this is that the price has already broken out from a short-term descending wedge. The wedge is considered a bullish pattern and could catalyze the breakout from the long-term resistance line.

The six-hour RSI supports the ongoing price increase and movement above the long-term resistance line. The indicator is moving upwards and just increased above 50.

The main remaining obstacle is the minor resistance at $0.53. Once MATIC clears it, it will likely increase toward the resistance above at $0.85.

MATIC Short-Term Movement
Polygon (MATIC) Six-Hour Chart. Source: TradingView

Therefore, the most likely MATIC price prediction is a breakout from the resistance line and an increase towards $0.85. However, if the price gets rejected from the resistance line, a 35% drop to the $0.35 horizontal support area will likely be the future price movement.

For BeInCrypto’s latest crypto market analysis, click here.

Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Exodus Exodus Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024
Harambe AI Harambe AI Explore
Uphold Uphold Explore
Exodus Exodus Explore
Coinbase Coinbase Explore
Chain GPT Chain GPT Explore
Top crypto projects in the US | July 2024

Trusted

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.

Valdrin-Tahiri.jpg
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)
READ FULL BIO
Sponsored
Sponsored