- Polygon is testing the descending parallel channel’s boundary support following the retreat from $0.54.
- The slump in network growth adds credence to the bearish picture.
- Above the channels’ upper boundary, price action would trigger more orders as MATIC heads to new record highs.
Polygon has lost over 7% of its value in the last 24 hours. The asset is currently rebranding from MATIC and boasts of a market cap of $1.8 billion. In the last 24 hours, the token has attracted roughly $457 million in trading volume across all exchanges. Meanwhile, Polygon is teetering at $0.37 while declines linger.
Polygon least resistance path is downwards
MATIC is trading within a descending parallel channel. The channel’s middle boundary has anchored the immediate downside. Short-term analysis based on the Moving Average Convergence Divergence (MACD) suggests that declines are likely to continue.
The asset’s momentum indicator has a vivid bearish impulse. If the MACD line (blue) stays significantly under the signal line, selling pressure will rise appreciably. Similarly, action below the middle boundary support may trigger more sell orders, increasing the overhead pressure.
MATIC/USD 4-hour chart
On the downside, the 50 Simple Moving Average is in line to offer support. But if bypassed, buyers will be forced to seek support at the 100 SMA and 200 SMA, respectively.
The bearish narrative has been validated by a massive slump in the token’s network growth, as illustrated by Santiment’s on-chain data tools. The number of addresses joining the protocol daily topped out at 3,820 on March 12. However, at the time of writing, the addresses average at 1,856, representing a 51.4% drop.
A low or declining network growth is a bearish signal. It shows that the project is losing traction in adoption. This also affects the inflow and outflow of tokens on the network.
%20[12.55.23,%2016%20Mar,%202021]-637514859578902304.png)
Polygone network growth
Looking at the other side of the picture
It is essential to realize that that the descending channel’s middle support is still in place. If the price holds above this zone, buyers will begin to look upward towards $0.54. A break above the channel could trigger many buy orders, bolstering MATIC to assault the record high.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Google, Apple could remove Binance from their app store on Philippines SEC request
The Philippines SEC has requested Google and Apple to remove applications controlled by Binance from their App stores. The exchange’s Philippines-based users are finding the exchange inaccessible to remove their funds.
XRP rallies as Ripple slams SEC for penalties, asks regulator to establish likelihood of future violations
Ripple filed its response to the SEC lawsuit on Monday, arguing that XRP institutional sales before and after the court ruling show no disregard for the law. The firm asks for a civil penalty of no more than $10 million against the $2 billion requested by the SEC.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
PENDLE price soars 10% after Arthur Hayes’ optimism on Pendle derivative exchange
Pendle price is among the top performers in the cryptocurrency market today, posting double-digit gains. Its peers in the altcoin space are not as forthcoming even as the market enjoys bullish sentiment inspired by Bitcoin (BTC) price.
Bitcoin: BTC post-halving rally could be partially priced in Premium
Bitcoin (BTC) price briefly slipped below the $60,000 level for the last three days, attracting buyers in this area as the fourth BTC halving is due in a few hours. Is the halving priced in for Bitcoin? Or will the pioneer crypto note more gains in the coming days?