Polygon (MATIC) has been on an upward trend since it broke out of a rising wedge pattern last week. Across all time frames examined by CoinGecko, MATIC has been on the rise, with the monthly time frame revealing the most increase (41.9%).
The crypto has been able to mount a decent rally, climbing 13% in the last seven days. But, there’s a lot of higher ground to cover.
The token’s current trading price of $1.05 which is below its opening price of $1.30, indicates that it was strongly rejected at that level. Since the MATIC token’s Stoch RSI values have recently been trending down from the overbought side, this poses a substantial risk to bulls.
Will MATIC be able to maintain its stability or will it eventually fail?
Large Correction Forms For Polygon
After starting its climb in late October, the token is currently in its correction stage after a protracted wick rejection on the $1.3075 price level. While the Stoch RSI values are falling, the CMF index is trending higher, giving the bulls a boost.
Rallies like the one MATIC is in are, however, susceptible to corrections, which often occur after the asset achieves a rejection. Lower time frames, however, show that MATIC is stabilizing above the $1.1241 support level.
The bull-bear strength indicator is currently on the bears’ side and is in direct opposition to the CMF indicator. If MATIC breaches the range of support at $1.1241, the bulls can stabilize the price around $0.9367, which still supports MATIC’s path to further highs.
As Polygon becomes increasingly connected with traditional financial institutions, investors and traders should monitor macroeconomic developments.
MATIC Performance On The Crosshair
As MATIC reaches new heights and its engagement in the traditional financial sector becomes more obvious, its performance in the next days will reflect this development.
As institutions look to Polygon as a gateway to Web3 and DeFi, the stabilization of the token above the 23.60 Fib retracement line could be a stimulus for further rally.
This could be the beginning of a new age for Polygon, as the increased institutional interest in Web3 technology and DeFi will bring in new investors and traders.
But for the time being, MATIC investors and traders should prepare for the continuing corrective period and avoid becoming greedy, as this could result in another market decline.
This price fluctuation also disrupted MATIC’s link with Bitcoin, which is excellent news given that BTC is trading at a loss. We should anticipate more highs and lows for MATIC in the coming days.
MATIC total market cap at $8.5 billion on the daily chart | Featured image from Blockchain News, Chart: TradingView.com