• Polygon price hit a curb with a false breakout above the monthly R2 resistance level.
  • MATIC sees its rally fade quite quickly due to lack of tailwinds.
  • Expect a further leg lower in search of some support before rebooting the uptrend.

Polygon (MATIC) has been halted in its tracks after attempting to retake the monthly R2 resistance level at $2.50. As MATIC price fades quite sharply, bulls will want to wait for a solid entry-level before reengaging. In the meantime, bears have their hands free to run price action further down towards $1.80.

MATIC bulls are sidelined, awaiting the right time and entry to engage

MATIC price is fading strongly after bulls’ failed attempt to break above the monthly R2 resistance level near $2.50. The pull-back actually presents bulls with an excellent entry-level to rejoin the rally and reboot the trade, with the potential to hit new all-time highs. At the same time,  the break below the R1 resistance level at $2.20, shows bears are further in control of MATIC price action, especially as market sentiment continues to pitch negative.

As such, a further 17% devaluation is a plausible outcome by the end of the week. This is further likely because bulls will want to wait for a proper entry-level near $1.80, together with the historical level at $1.75. These two elements should help contain any further sell-offs and should see a bullish uptick as the Relative Strength Index (RSI) will by then be trading around the 50-level. This should attract more investors and see a reboot of the uptrend towards new all-time highs at $2.90.

MATIC/USD daily chart

MATIC/USD daily chart

Should market sentiment turn positive, expect this to provide a catalyst for MATIC price to perform a U-turn and retest $2.50 quite quickly. At that level there may be some nervousness as previous attempts failed before, but with the RSI not yet in overbought, expect more room for investors to play the rally and target new all-time highs at $3.0.

 

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