Polygon Bear Cycle Predicts MATIC Drop to $0.38

MATIC Price Performance

Polygon’s price initially surged following a bullish breakout from a falling channel pattern, reaching a peak of $0.60. Last week, MATIC experienced a notable 27.43% increase, resulting in a significant bullish engulfing candle on the weekly chart. However, the increased market volatility has led to a rapid decline in Polygon’s price.

• Recent Decline: The price has dropped by 18.86% this week, undermining last week’s recovery.
• Current Price: MATIC is currently trading at $0.4256.
• Bearish Trend: The daily chart shows a series of five consecutive bearish candles, testing the previously broken resistance trendline.

On-Chain Support for Polygon

Despite the recent bearish price action, the on-chain platform IntoTheBlock presents mostly bullish signals for Polygon. Key on-chain metrics include:

• Network Growth: A 0.30% increase.
• Concentration Increase: Up by 0.18%.
• Large Transactions Surge: An 11% rise in large transactions.
• Exchange Signals: A 4.7% increase in bid-to-ask volume imbalance.

Despite these positive indicators, a 14% drop in the money segment presents a bearish signal. Overall, IntoTheBlock provides five bullish and one bearish indicator, suggesting a potential buy signal.

However, it’s important to note that only 3% of holders are profitable at the current price, and large holders concentrate 85% of the trading volume.

Technical Indicators

• RSI: The daily Relative Strength Index (RSI) has declined from the overbought boundary to 42%, falling below the halfway line and the 14-day Simple Moving Average (SMA).
• EMA: Both the 50-day and 200-day Exponential Moving Averages (EMAs) maintain a bearish trend following the death cross observed in April 2024.

Will Polygon Price Drop Under $0.40?

Given the current bearish continuation, the MATIC price could potentially fall back into the falling channel pattern, putting the $0.38 level at risk. A further bearish breakdown could lead to an extended decline towards the support trendline around $0.3470.

On a more optimistic note, a double-bottom reversal from the $0.38 support level could provide a potential opportunity for buyers. This support zone is known for its role in price reversals, and a bullish divergence in the RSI could serve as a positive indicator for a rebound.