- MATIC continues to test the upper trendline of a rising wedge.
- Warning signs of support failing could initiate a 31% drop.
- Upside potential remains but is likely limited.
MATIC price action has recently generated significant warning signs regarding how much higher it can move over the short term. The past seven days have seen testing the upper trendline of a broader rising wedge pattern that has existed since September 2021.
MATIC price could drop over 30% and below the rising wedge pattern, liquidating many long positions
MATIC price is on a knife’s edge for bulls. MATIC is right on top of the upper trendline of a former rising wedge pattern on the daily candlestick chart. This represents the seventh major test of that trendline as support or resistance since November 2021. Contributing to the significant bearish warning signs present is the pattern developing on the $0.05/3-box reversal Point and Figure Chart.
There is a head-and-shoulders pattern and a quintuple-bottom bearish breakout trade setup for MATIC price. The theoretical short setup is a sell stop order at $2.40, a stop loss at $2.60, and a profit target at $1.75. This trade idea represents a 3.25:1 reward for the risk with an implied profit of 26% from the entry. A two-box trailing stop would help protect any profit generated post entry.
MATIC/USDT $0.05/3-box Reversal Point and Figure Chart
However, one of the most sought-after bullish patterns in Point and Figure is also developing for MATIC price. The Bullish Catapult pattern will be complete if the current X-column moves up to $2.75. That would invalidate the theoretical short entry.
The hypothetical long entry for MATIC price from the Bullish Catapult is a buy stop order at $2.75, a stop loss at $2.55, and a profit target at $3.35. This trade represents a 3:1 reward for the risk with an implied profit target of nearly 23% post entry.
MATIC/USDT $0.05/3-box Reversal Point and Figure Chart
The long idea is invalidated if the short entry were to trigger first.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Ripple's move above this key level could trigger nearly 50% rally for XRP
Ripple has overcome a critical resistance level and flipped into a support floor on the weekly time frame. This development happened while XRP tightly consolidated for roughly 250 days. Investors can expect XRP to kickstart a massive rally.
Optimism price outlook with nearly $90 million worth of OP tokens flooding markets on Friday
Optimism volatility has shrunk in the ours leading to the network’s cliff unlock. It joins the likes of dYdX and Sui, which have similar events on their calendars. As token unlocks are often considered bearish catalysts, investors should brace for a reaction after the event.
Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Retail watches from the sidelines with a bias for shorts
Bitcoin could clear $73,777 peak as BTC bulls resurface. Ethereum might fall 10% before next leg up as ETH RSI teases with sell signal. XRP could lose $0.6000 threshold as Ripple bulls fail to show up.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito price action shows a potential cup and handle formation. Based on theoretical measurement rules, a successful breakout could yield a 56% rally to $6.0. A breakdown of the $3.86 support level would create a lower low for JTO and invalidate the bullish thesis.
Bitcoin: BTC may have recovered, but is it out of the woods?
Bitcoin’s (BTC) upward momentum has shown a significant decline for the past two weeks or so. This development led to a bearish signal on the weekly and an uncertain outlook on the monthly.