Polygon’s success story is at stake
- MATIC price drops 13%, engages critical support including 2021 uptrend line.
- The break of the symmetrical triangle of the polygon on June 15 may have been a bull trap.
- Some on-chain metrics support a constructive view of the Indian blockchain platform.
MATIC price once again showed relative strength with the June 15th breakout of a symmetrical triangle. Still, the bullish price action quickly faded, pushing Polygon towards a critical support area. The digital asset needs the current price range to hold or is at risk of breaking the long-standing trendline of early 2021.
MATIC price gains now appear temporary, as cryptocurrency complex turns red
The price of MATIC jumped nearly 60% from the June 12 low to the June 15 high, breaking the indecisive trends of most altcoins. Volume increased during the brief upward streak, but remained well below the level that accompanied the rebound from the May 23 low, suggesting that Polygon speculators were still reluctant to enter the market with a significant commitment.
MATIC price is down nearly 30% from June 15 high, breaking 50-day simple moving average support at $ 1.42 ahead of current volume-weighted average price confluence test anchored (anchored VAP) at $ 1.33, with the 2021 the uptrend line and the lower trendline of the symmetrical triangle.
For now, Polygon investors should wait for a daily close below the well-established support mentioned above to rethink their bullish narrative. If the MATIC price closes below $ 1.25, this will be the initial signal that the altcoin may be preparing for a further lower leg. A daily close below the June 12 low of $ 1.12 would be necessary confirmation that a trend change has occurred.
If the bullish narrative undergoes this retracement, traders in the Polygon market should visualize resistance materializing at the intersection of the psychologically important $ 2.00 level and the $ 2.04 high on May 31.
A energized cryptocurrency market could take MATIC’s price to a May 26 high of $ 2.48 and potentially the all-time high of $ 2.89 recorded on May 19.
It is important to note that the bullish alternative does not foresee a relentless progression but a measured evolution, frequently interrupted.
MATIC / USD daily chart
A close below $ 1.12 changes everything for the MATIC price. It would be a blow to the powerful uptrend since the start of 2021, forcing a complete reassessment of the bullish government narrative for the year.
Santiment’s recently increased Daily Active Addresses (DAA) measure supports a favorable outlook for the MATIC price. The metric shows the number of unique addresses involved in MATIC transactions on a daily basis. It indicates the daily level of crowd interaction or speculation with a token. Higher numbers tend to be bullish.
Since June 9, daily advance addresses have turned high, accelerating the uptrend of the 7-day average which hit a low on June 5. One caveat against the uptrend metric is breaking the uptrend line for the 7-day average since the close. April. It might be nothing, but it’s still a factor to watch if the MATIC price gains traction.
MATIC Daily Active Addresses (DAA) – Santiment
Another complementary in-chain metric is the Santiment Supply on Exchanges metric which indicates the total amount of MATIC located in known exchange portfolios. Peaks in this metric tend to indicate a peak in short-term selling pressure.
Since the May high for the metric, supply on the MATIC exchange has declined and is back below the 30-day average, suggesting the selling pressure on Polygon has exhausted. This is an encouraging sign in a time of uncertainty and increased volatility in the MATIC price.
MATIC Stock exchange procurement – Santiment
Polygon is receiving increased attention for its response to some of the challenges facing the Ethereum blockchain, such as high fees, poor user experience, and low transactions per minute. He is involved in the most current areas of cryptocurrency including DeFi, DApps, DAO, and NFT.
Despite the flattering on-chain metrics and compelling fundamental story, the MATIC award is now on the line with few tech support barriers remaining between it and a completely different script.