MATIC bounces big as Polygon bulls target return to $1.70

MATIC price has developed a strong buying response as it approached the 100% Fibonacci Expansion near $1.40. However, the drip below the support zone at $1.48 was a very bearish event and could be a precursor to moves that would return Polygon to the $1.20 zone.

MATIC price approaches 2022 lows; bulls must show conviction to prevent further selling pressure

MATIC price is currently in the weakest states it's been in since the first breakout down below the Ichimoku Cloud on January 20, 2022. The drop below the highlighted support zone is either a giant bear trap or a confirmed bearish breakout. Bulls have pushed MATIC close to the bottom of that support zone to test the breakout, now as resistance.

If the resistance level holds, then MATIC price faces another push down to $1.40. However, $1.40 is a highly potent support zone. It contains the 100% Fibonacci expansion, the 78.6% Fibonacci retracement, and the top of the weekly Ichimoku Cloud (weekly Senkou Span B). Therefore, failure to hold the $1.40 value area could trigger a sell-off towards $1.20.

MATIC/USDT Daily Ichimoku Kinko Hyo Chart

For bulls to invalidate any near-term bearish outlook, they must ultimately return MATIC price above the Ichimoku Cloud. The road to achieving that task, however, is massive. Buyers would need to rally Polygon more than 50% to a close at or above $2.13 to start and confirm the beginning of a new uptrend. Over the next six weeks, sideways price action is very likely until the top of the Ichimoku Cloud on the daily chart drops to around the $1.70 value area.