Polygon (MATIC) May Drop to $2.5 after the New ATH

Briefly –

  • Polygon gained some ground after its native token touched new ATHs.
  • Decisive gaps inside the Ichimoku Kinko Hyo reveal a potential mean reversion formation.
  • Upward potential remains limited until MATIC completes a retest.

Polygon (MATIC) resumed its massive bullish run past a rising wedge. The altcoin extended its surges briefly past the crucial value area at $3.0.

MATIC to Pullback to $2.5 before another ATH Run

MATIC has led the crypto space in December as far as price actions are concerned. The alternative coin has surged over 60% since this month started to its latest new ATH. However, that swift climb is likely to attract profit-booking by enthusiasts.

MATIC tested the break past the rising wedge recently (24 December) after retesting the shared support area around the Tenkan-Sen and the climbing wedge pattern’s upper trend-line at $2.40. Confirming this support took Polygon price higher towards the new ATH o $2.92. Analysts believe the alt will hit $3 before a downward pressure emerges, but that isn’t a requirement.

The Tenkan-Sen and daily candlesticks’ bodies show significant gaps emerging, restricting MATIC’s higher movement with potential pullbacks. Moreover, the Optex Bands nears a massive overbought case as the Composite Index prints bearish divergence.

For now, MATIC has higher chances of retracing towards the Tenkan-Sen near $2.5 before supporting further upward momentum. Nevertheless, MATIC does not have to plunge, but it may endure a mean reversion with time. In such a case, the alternative token would consolidate for around three weeks inside the $2.80 – $3.0 value zone. The daily Kijun-Sen around $2.25 should limit MATIC’s downtrend.

Keep in mind that most digital coins retrace after remarkable surges. With that, they gather momentum and establish reliable support for an extended upward move. Furthermore, correction phases seem not to bother crypto fans that much. However, things might get worse sometimes.

Current price declines in Bitcoin support the downward narrative in MATIC. Bitcoin failed to stabilize around $51,000 and retraced towards the $49K level at this publication. Such moves meant corrections in the crypto world.

Stay around for more updates on digital coins.

Editorial credit: Dennis Diatel / shutterstock.com