MATIC: This support zone could be key to sustaining bullish narrative

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Dis­claimer: The find­ings of the fol­low­ing analy­sis are the sole opin­ions of the writer and should not be con­sid­ered invest­ment advice.

Over near­ly two months, Poly­gon [MATIC] bulls have been on the front foot as they estab­lished the altcoin’s posi­tion beyond the 20/50 EMA. This recov­ery ini­ti­at­ed a crit­i­cal bull­ish crossover on the 20 EMA (red) and the 50 EMA (cyan).

The breach of the four-month trend­line sup­port (pre­vi­ous resis­tance) gave the bulls enough fire­pow­er to retest the $0.95-ceiling. A con­vinc­ing close below the pat­tern could expose the cryp­to to a near-term down­side in the com­ing sessions. 

At press time, MATIC was trad­ing at $0.908, down by 2.34% in the last 24 hours.

MATIC Daily Chart

Source: Trad­ingView, MATIC/USDT

The ongo­ing ascend­ing chan­nel (white) tra­jec­to­ry revealed the under­ly­ing uptick in bull­ish pres­sure. As a result, the broad­er out­look start­ed to shift slight­ly in favor of the bulls.

Alas, with the 200 EMA resis­tance coin­cid­ing with the $1.04-$0.95 range resis­tance, MATIC could see a stiff hur­dle in the com­ing sessions.

On the flip side, empir­i­cal bull­ish crossovers on the 20/50 EMA have ensured near-term sup­port in the 20 EMA zone. So, the alt could con­tin­ue its com­pres­sion in the $0.74-$1 range before com­mit­ting itself to a trend.

A decline below the up-chan­nel could trig­ger a near-term decline towards the $0.74-level before a like­ly rever­sal. An even­tu­al close above the $1.04-level can pro­voke a test of the upper trend­line of the up-chan­nel before a pullback.

Rationale

Source: Trad­ingView, MATIC/USDT

The Rel­a­tive Strength Index (RSI) ensured its posi­tion above the mid­line to depict a slight buy­ing edge. A sus­tained posi­tion above the 58-mark sup­port could con­tin­ue sup­port­ing near-term buy­ing inclinations.

Fur­ther­more, the Chaikin Mon­ey Flow’s (CMF) decline below zero high­light­ed a sell­ing advan­tage. Even so, it marked low­er troughs over the last two weeks and bull­ish­ly diverged with the price action.

The Vol­ume Oscil­la­tor (VO) was on a steep down­trend as the trad­ing vol­umes took a sharp plunge over the last few days. A poten­tial uptick in the vol­umes could help the alt break away from its low volatil­i­ty phase.

Conclusion

MATIC’s sway above its 20/50 EMA rib­bons reflect­ed a near-term bull­ish advan­tage. A rebound from the low­er trend­line of the up-chan­nel could encour­age a bull run before a pullback.

How­ev­er, a drop below this rever­sal pat­tern could entail a short-term decline. The tar­gets would remain the same as dis­cussed above.

Final­ly, investors/traders must keep a close eye on Bitcoin’s move­ment as MATIC shares a stag­ger­ing 86% 30-day cor­re­la­tion with the king coin.

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