MATIC price could slide 15% lower as Polygon bulls tire out
|- MATIC price upside is limited as it faces a bearish breaker, extending from $1.75 to $2.15.
- A rejection at this hurdle could see Polygon drop 15% to a support level at $1.44.
- A daily candlestick close above $2.15 will invalidate the bearish thesis.
MATIC price has created a bearish setup that forecasts a correction is around the corner. However, the downswing might be cut short due to the presence of a palpable support level along the way. Regardless, polygon holders should prepare for a minor pullback.
MATIC price to head lower
MATIC price set up a higher high between December 8, 2021, and December 27, 2021. The trough between these two swing points established a demand zone, extending from $1.75 to $2.15.
However, the flash crash on January 21 pushed Polygon to produce a daily candlestick close below $1.75, flipping the said demand zone into a bearish breaker. This setup forecasts that a retest of the breaker leads to rejection and a potential crash.
As MATIC price retests the breaker for the third time, investors can expect another rejection to lead to a 15% retracement to the daily support level at $1.44.
A breakdown of the $1.44 barrier could lead to a retest of the $1.22 foothold. In a highly bearish case, MATIC price could sweep below the $1.04 weekly support level and collect the sell-stop liquidity resting below it. This development would bring the total crash to 40%.
MATIC/USDT 1-day chart
Multiple retests of the $1.75 to $2.15 bearish breaker weakens its potency and could signal that the bulls are making a comeback. If MATIC price pierces through the said breaker to produce a daily candlestick close above $2.15, the bearish thesis will face invalidation. In this scenario, MATIC price could rally 14% and tag the $2.45 hurdle.
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