- Polygon (MATIC) formed a six-month rising wedge hitting its ATH at $2.93 on December 27, 2021.
- MATIC continues to go downhill after reaching its ATH.
- The investors/traders must keep a close eye on Bitcoin movement as MATIC shares a staggering 90% 30-day correlation with the King coin.
Polygon (MATIC) was on long-term uptrends as it formed a six-month rising wedge, hitting its all-time high (ATH) in December. Since then, MATIC has been on a downhill while having a topsy-turvy relationship with the EMA ribbons.
(Source: TradingView)
As the current falling wedge decline approaches the long-term floor at $0.93, the bulls would be keen to break the streak of the bearish candlestick on the daily chart. At the time of writing, MATIC trades at $0.941, with a 24-hour trading volume of $548 million, and down by 5.79%.
Moreover, MATIC’s price is open to hitting another 21% to retest the range low at $0.745. In some circumstances, if the selling tension spikes quite a bit, there is a good possibility that Polygon could stoop lower.
This recession could allow market makers to fill the price inefficiency known as the fair value gap at $0.467, bringing the total downfall to 52%.
Surprisingly enough, IntoTheBlock’s Global In/Out of the Money (GIOM) model backs this bearish viewpoint. This index reveals that around 30,000 addresses bought nearly 1.8 billion MATIC tokens at an average price of $0.473 and are “Out of the Money.”
(Source: Global In/Out Money)
Therefore, a drop into this barrier is possible to be supported by these investors who could choose to buy more, alleviating the selling pressure.
To sum up, in light of the falling wedge set-up coupled with the potential of bullish divergence on the RSI, MATIC could see a short-term revival. A close above the current pattern would expose the altcoin to the boundaries of its EMA ribbons in the $1.2 – $1.3 range.
Finally, the investors/traders must keep a close eye on Bitcoin movement as MATIC shares a staggering 90% 30-day correlation with the King coin.
Disclaimer: The views and opinions expressed in this article are solely the author’s and do not necessarily reflect the views of CoinQuora. No information in this article should be interpreted as investment advice. CoinQuora encourages all users to do their own research before investing in cryptocurrencies.