Polygon Price Forecast: What crypto traders are looking for from Jerome Powell on Wednesday

Polygon (MATIC) price has received a firm rejection on the top side at $1.18, which triggered a massive wave of profit-taking as traders wanted to cash in on profits, not taking the risk of staying in the trade. With several central banks coming out this week, including the most important Federal Reserve interest rate decision on Wednesday at 19 GMT, violent swings look granted. Trying to create order in the chaos, only one message will be important for cryptocurrencies: the message from Fed chair Jerome Powell. 

Polygon price sees traders on full alert for Powell’s words

Polygon price received a short but harsh rejection on Monday, which can be labelled profit-taking as a bunch of traders decided not to sit on the risk. Meanwhile, a new bunch of traders is eager to get in and try to play a pre-position trade in the idea that markets are selling the rumour and a dovish central bank will offer a buy-the-fact moment, with MATIC rallying higher. Markets will be hanging on Jerome Powell’s lips.

MATIC is set to jump higher in case Powell confirms the Fed hikes 25 basis points and possibly another 25 basis points after that and be done with it. Everything more dovish than that will be even more bullish for cryptocurrencies. A breakout trade looks to result in a break above $1.18 and open a new area for Polygon price to rally in the coming weeks, with $1.57 as the next profit target by the end of February.

MATIC/USD daily chart

As mentioned above, with already a few scenarios, a more hawkish scenario could be Jerome Powell delivering a 25 basis point hike with a very harsh hawkish comment or even a 50 basis point hike. That would mean markets have been blindsided and completely ignored the warning signs of the Federal Reserve being still hawkish, which would trigger a repricing of a risk premium. In that case, expect MATIC to tank towards $0.96 with even overshooting towards $0.90 towards the 55-day and the 200-day Simple Moving Averages.