Polygon (MATIC) was in a steady uptrend as it formed a six-month bullish wedge (yellow) reaching its ATH on December 27. Since then, it has seen a steep drop as it moves below the 20-50-200 EMA.
Going forward, MATIC attempted to test the 61.8% Fibonacci support at the $1.5 mark and confirm the beginning of a downtrend for the alt. Investors should keep a close eye on the 20 EMA (green). Any close above this level could result in a short-lived downtrend. As of going to press, MATIC was trading at $1,602, down 5.9% in the past 24 hours.
MATIC daily chart
Since its ATH, the alt has tested its nine-month trendline (previous support) twice before snapping it to form a bearish flag on the daily chart. As a result, price action dropped below the 200 EMA (blue), indicating a possible start of a long-term downtrend.
After falling more than 50% (since its ATH), MATIC picked itself up from the 61.8% Fibonacci support, only to face strong resistance near the $2 mark. With multiple bearish candlesticks engulfed in the past four days, the alt reaffirmed the bearish flag after breaking out and reaffirming selling pressure.
While the current price is still not congested from its 20-50-200 EMA, the likelihood of a sustained downtrend is increasing as it sought to test the USD 1.5 level. This level would be a crucial zone for the buyers to enter and avoid further drift towards the $1.2 mark. In addition, the price fell below the 200 EMA for the first time since July 2021. Given the weak technical data, there are slim chances for the alt to reverse the current trajectory.
The RSI lost its centerline after forming a bearish divergence with the price. It headed south and was intended to retest the 38 mark. In addition, as the -DI looked north, the bears confirmed their strength which would justify bearish moves in the coming days. But his ADX was in a downtrend while showing a weak directional trend.
Taking into account the confluence that has developed between the wooded factors, MATIC had to brace for an ongoing downtrend. Any close below the gold Fibonacci level would fuel a test of $1.2 in the coming days. Nevertheless, the broader market sentiment must also be taken into account in order to make a profitable move.
This post Should you HODL or sell? This is where MATIC can go next week
was published first on https://ambcrypto.com/should-you-hodl-or-sell-this-is-where-matic-could-head-in-the-coming-week/