The Polygon (MATIC) Price Breaks Resistance, Indicating Potential Increase
The Polygon (MATIC) price has recently broken out from a short-term descending wedge and is now attempting to clear a long-term descending resistance line. This breakout could lead to a significant price increase. However, if the price is rejected from the resistance line, it may experience a drop towards the closest horizontal support area.
Polygon Price Struggles Below Resistance
In the daily timeframe, the MATIC price has been under a descending resistance line since February 28, when it reached its yearly high of $1.57. The price has fallen from the $0.60 horizontal support area and validated it as resistance on August 29. The validation coincided with the final touch of the descending resistance line, indicating a bearish trend. Since then, the price has not reached the line again.
If the MATIC price successfully breaks out from the resistance line, it could increase by 60% and reach the $0.85 horizontal resistance area. On the other hand, if it gets rejected again, there may be a 35% drop towards the closest support at $0.35.
RSI Indicates Potential Bullish Trend Reversal
Despite the bearish price action, the daily Relative Strength Index (RSI) suggests a potential bullish trend reversal. Traders use the RSI to gauge momentum and identify overbought or oversold conditions in a market. An RSI reading above 50 during an upward trend favors bulls, while a reading below 50 implies the opposite.
Although the RSI is still below 50, it is increasing and has generated significant bullish divergence. This occurs when there is an increase in momentum alongside a decrease in price and often leads to bullish trend reversals. In the case of MATIC, it could result in a breakout from the long-term descending resistance line.
MATIC Price Prediction: Short-Term Breakout Expected
Looking at the shorter-term six-hour timeframe, it is likely that the price will successfully break out from the long-term resistance line. This is supported by the fact that the price has already broken out from a short-term descending wedge, which is considered a bullish pattern.
The six-hour RSI also supports the ongoing price increase and movement above the resistance line. The indicator is moving upwards and has recently crossed above 50. The main obstacle now is the minor resistance at $0.53. Once this level is cleared, it is expected that MATIC will continue to increase towards the resistance at $0.85.
Hot Take: Potential Breakout for MATIC Price
The Polygon (MATIC) price has shown signs of breaking out from a long-term descending resistance line. This breakout, combined with bullish divergence on the RSI, indicates a potential increase in price towards the $0.85 resistance area. However, if the price gets rejected from the resistance line, a drop to the $0.35 support area may occur. Traders should closely monitor these key levels to make informed trading decisions.
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