Polygon’s [MATIC] drops by 7% – Will $1.082 support hold?
Polygon (MATIC) has experienced a drop of over 7% in the past 24 hours, and the value has now reached a crucial support level of $1.0818. This support level has checked previous plunges and could provide some hope for bulls if it can hold this time. However, the asset broke below its parallel channel pattern and a significant confluence of supports at $1.12, giving sellers more leverage to devalue the asset.
Will the $1.0818 support hold?
The $1.0818 level has been a critical support at the end of March and throughout the second half of April. The RSI and stochastic RSI have hit oversold territory, indicating that selling pressure has increased but sellers may look for a break. Additionally, the rising OBV (On Balance Volume) suggests that MATIC has seen an uptick in demand at the current discounted levels, which could boost a recovery.
If this support level holds, MATIC could recover, but it will need to deal with the hurdle near the confluence area of $1.12, which lines up with an ascending trendline (yellow line) and 200-MA (blue line). The next immediate resistance level is $1.14, an intersection of the channel’s lower level and 50-EMA (orange line). Both of these hurdles must be cleared before MATIC returns to the previous price range of $1.139 – $1.189.
However, if price action closes below the $1.0818 support, near-term bears could gain more leverage. In such an extended plunge scenario, the downswing could devalue MATIC to $1.0553 or the recent swing low of $1.0261. These levels can act as short-selling targets.
Supply on exchange increased: exchange flow balance declined
On-chain metrics show mixed signals for MATIC at the time of writing. The supply on exchange has increased, indicating that more MATICs were available on CEXs for offloading, resulting in an elevated short-term selling pressure. On the other hand, the exchange flow balance was negative, implying that more MATIC was moved out of exchanges, resulting in a short-term accumulation trend.
There has also been increased whale activity transacting over $1 million, which could influence MATIC’s price direction. Therefore, investors should track this front alongside BTC’s price movement for optimized trade setups.
Conclusion
Polygon (MATIC) has experienced a significant drop in value, but the $1.0818 support level may provide some hope for bulls. The rising OBV suggests that there is an uptick in demand, but the asset must deal with hurdles near the confluence area of $1.12 and $1.14 to return to the previous price range. In the short term, if the support level fails to hold, MATIC could face more selling pressure and drop to $1.0553 or $1.0261, which could act as short-selling targets. Investors should keep an eye on the supply on exchange, exchange flow balance, and whale activity, which could influence MATIC’s price direction.
a crucial level for MATIC in the past, as it has managed to check previous plunges and allowed for a recovery. However, the current market sentiment remains bearish, and the asset’s performance largely depends on whether the support level can hold or not. It is important to keep an eye on the overall market sentiment, as the crypto market is highly volatile and can experience sudden price swings. Additionally, the performance of other major cryptocurrencies, such as Bitcoin, can also impact the value of MATIC. In conclusion, while the current market sentiment remains bearish, there are some positive indicators that could suggest a potential recovery for MATIC. The rising OBV and increased whale activity are both promising signs, but it is crucial to monitor the performance of the asset and the market as a whole to make informed trading decisions. Whether or not the $1.0818 support holds will largely determine MATIC’s price direction in the near future.
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