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Analyzing the Recent Polygon (MATIC) Decrease: Can It Bounce Back Above $1?

2 mins
Updated by Ryan Boltman
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In Brief

  • Polygon's (MATIC) price fell significantly this week after it was rejected by a horizontal resistance area.
  • The daily time frame gives a bearish reading. This is based on the price action and Elliott Wave count.
  • Despite the bearish MATIC price prediction, an increase above $0.96 will mean the local bottom is in.
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The Polygon (MATIC) price has decreased since December 17, 2023. It recently fell below a horizontal resistance area.

Despite the decrease, MATIC still trades above an ascending support trend line. Can it begin a bounce?

Polygon Falls Below Resistance

The daily time frame technical analysis shows that the MATIC price has traded below the $0.95 horizontal resistance area since November 2023.

The price briefly moved above this area in December (red circle) but fell below it shortly afterward. This, in turn, turns the breakout into a deviation. So far, the resistance area has rejected the MATIC price three times (red icons). After the final rejection, MATIC returned to an ascending support trend line.

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

The daily RSI gives a bearish reading. Traders utilize the RSI as a momentum indicator to assess whether a market is overbought or oversold and whether to accumulate or sell an asset.

If the RSI reading is above 50 and the trend is upward, bulls still have an advantage, but if the reading is below 50, the opposite is true. The RSI is falling and below 50, both signs of a bearish trend.

Unlike the price action and RSI, news about Polygon is positive. A report by Electric Capital noted that Polygon was the chain that drew the 2nd most new developers in 2023, with 6,208, trailing behind only Ethereum.

MATIC Price Prediction: How Long Will Decrease Continue?

A look at the movement over the past five months gives a bearish MATIC outlook. This is because of the wave count.

Elliott Wave theory involves the analysis of recurring long-term price patterns and investor psychology to determine the direction of a trend.

The most likely wave count suggests that the MATIC price has completed a five-wave upward movement (black) and has started an A-B-C correction. If so, it is currently in the C wave of this correction.

The most likely level for the bottom is at the $0.63 horizontal support area, 20% below the current MATIC price.

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

Despite this bearish MATIC prediction, moving above wave B’s high (red) of $0.96 will mean the local bottom is in. Then, MATIC can increase by nearly 37%, reaching the December 2023 high at $1.10.

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

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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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