- MATIC price has been consolidating in a bullish pennant pattern, hinting at a 35% breakout soon.
- A decisive close above $0.40 will confirm the upswing to $0.55.
- A breakdown of the pennant at $0.37 could trigger a 20% correction to $0.30.
MATIC price is a crucial point that could catapult it or lead to a steep correction.
MATIC price needs a bounce
MATIC price has been on a tear as it surged more than 50% between March 11 and 12. Soon after, Polygon began consolidating, forming lower highs and higher lows. While the initial spike can be viewed as a “flag pole,” and the one that followed it is known as a “pennant.” Combing the two moves shows that MATIC price is forming a bullish pennant pattern.
The technical formation forecasts a 35% upswing, determined by adding the flag pole’s height to the breakout point at $0.40. This target places MATIC at $0.55.
While this is bullish, Polygon must bounce off the pennant’s lower trendline. If this surge propels MATIC price past the breakout point at $0.40, then a 35% impulse wave to $0.55 can be expected.
MATIC/USDT 6-hour chart
While the technical pattern shows a bullish bias, investors need to pay close attention to IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model. This on-chain metric shows massive resistance barriers up to $0.40.
Nearly 7,500 addresses that purchased 782 million MATIC tokens between $0.38 to $0.40 are “Out of the Money.” Hence, any short-term buying pressure could be halted by investors around these levels trying to breakeven.
MATIC IOMAP Chart
Therefore, a rejection of this barrier leading to a breakdown of the pennant’s lower trendline at $0.37 will invalidate the bullish outlook. In this case, MATIC price could drop 20% to a stable demand barrier at $0.30.
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