Will Polygon (MATIC) Test Its Pivot Point Soon After The Dip? - FX Leaders - FX Leaders
Polygon (MATIC) seems to be heading back higher after the downslide in the previous session, as crypto markets saw a sell-off following Bitcoin’s sharp decline under the $50,000 mark. At the time of writing, MATIC/USD is trading at around $2.56.
While MATIC manages to hold above the key $2.50 level for now, buyers were unable to hold the new ATH breached recently amid a deterioration in the overall market sentiment. However, the long term potential of Polygon remains strong, especially with Ethereum’s network congestion and gas fees issues unlikely to resolve anytime soon.
What Polygon offers is an ecosystem for Ethereum-based dApps to operate at higher levels of efficiency, with faster transaction processing capabilities and lower costs. The Layer 2 Ethereum scaling solution recently received quite the boost after leading DEX Uniswap integrated into its ecosystem, a move several more dApps could repeat soon.
In recent weeks, Polygon’s MATIC was one of the strongest performers in the market even as most of the Layer 1 cryptocurrencies languished amid a bearish mood among crypto investors. Investors are betting big on the blockchain’s abilities to solve Ethereum’s scalability challenges, especially after its recent investment into ZK-STARKs to help onboard one billion users into the Ethereum blockchain.
While the long term prospects for the MATIC token remain strongly bullish, the 14th largest cryptocurrency by market cap could trade under pressure in the short term. Recent analysis by Santiment indicates that there appears to be no profit taking in MATIC in the market lately but the number of whales accumulating Polygon’s token have dwindled in recent days. The firm forecasts some sell-off in the near term which could cause a price correction before it proceeds higher again.
MATIC/USD Technical Analysis
According to popular crypto influencer and analyst Justin Bennett, MATIC needs to take out strong resistance at $2.70 to head higher. If Polygon can hold above this level and make it a strong support, its price could rally as high as $4-4.50 soon.
On the 4-hour chart of MATIC/USD, the smaller moving averages along with leading technical indicators MACD and momentum suggest a bearish bias. However, the 50 EMA, 100 EMA and 200 EMA indicate interest among bulls as well.
Polygon’s price seems to be making its way back up towards the pivot point at $2.60. The immediate support is well below at $2.32, which is an encouraging sign. A break above the pivot point can increase investor confidence and send MATIC higher, so let’s keep an eye on this level for now.