MATIC bulls wait on the sideline as Polygon price drops towards $1.35
|- Polygon price is in a squeeze with pressures from both upside and downside.
- MATIC price could see an accelerated break to the downside before bulls pick up price action.
- Expect a break lower, with MATIC price looking for sustainable support.
Polygon (MATIC) price failed to push above the monthly pivot at $1.80,dropped and has since bounced off the 55-day Simple Moving Average (SMA) at 1.55. With supportive tailwinds fading and the ambience bearish, expect a break to the downside – although bulls will eventually be waiting for the right moment to pick up MATIC price action at an attractive discount.
MATIC price to present a proper discount before bulls step in
Polygon price is seeing pressure from both sides as a red descending trend line is forming an upper boundary line made up of lower highs and lows, formed on a daily basis. Dips are being picked up by bulls alongside the 55-day SMA. As both elements are pushing MATIC price, a squeeze is in effect.
MATIC price sees tailwinds fading, and more headwinds are popping up, depressing price action, which points to a bearish breakout from the squeeze. Bears will break the 55-day SMA, which initially opens the door for another 15% of losses, with support then kicking in from the 200-day SMA at $1.35. Expect to see a pause at this level as bears book profits At the same time, expect a countercurrent from bulls starting to fade into MATIC price.
MATIC/USD daily chart
Even with the 200-day SMA looking strong, expect a quick blip to the monthly S1 support level near $1.25 and the pivotal historical level at $1.20. These two levels will be the entry point most bulls will have in their books as trigger points to go long. At those levels, the Relative Strength Index (RSI) will be in oversold territory, which should signal to bears that further downside momentum is likely to be muted and see them booking profits. They will need bulls to take the other side of the trade and provide liquidity to do so.
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