MATIC extends retracement – Are bears back in the game?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Bears could be making an entry back after price rejection at critical resistance level.
- Shorts hold 53.47% advantage in long/short ratio.
Polygon [MATIC] looked to put behind its recent losses with a strong upward climb from a key support level. However, the bearish market structure curtailed the bullish move over the past week.
Read Polygon [MATIC] Price Prediction 2023-24
While bulls were still active, Bitcoin’s [BTC] sideways movement below $30k could give MATIC sellers more opportunities.
Bulls maintain uptrend despite pullback
The 12-hour price chart revealed a continuation of MATIC’s uptrend, despite the recent pullback encountered by bulls. The rally from the $0.5274 support level made a series of higher lows before experiencing significant resistance at the $0.8503 level.
The price rejection at this level minimized the bullish conviction of easily pushing past the resistance levels, despite price continuing on an upward trajectory. Although bulls immediately found support at the critical $0.7414 support level to halt the retracement, the on-chart indicators showed waning bullish momentum.
The Relative Strength Index (RSI) dipped toward the neutral 50 mark while the On Balance Volume (OBV) also eased slightly. Taken together, it highlighted the drop in buying pressure and demand for MATIC.
A bearish retest of the $0.7414 support level could see an aggressive dip to the $0.6000 – $0.6500 territory. However, bulls have a double-layer defense in the support level and a bullish trendline. A break below this bullish confluence would signal a clear shift in momentum.
A successful rebound for bulls at the support level could see a push for the $0.9504 price level which saw a lot of sideways price action between May and June.
Momentum lies with sellers
How much are 1,10,100 MATICs worth today?
Shorts registered their active presence by holding onto a large share of the open contracts for MATIC. A look at the exchange long/short data from Coinglass on the 12-hour timeframe revealed a 53.47% swing in favor of sellers.
This suggested that a retest of the $0.7414 level was likely and the price reaction at the level could either tip the balance in the favor of buyers or sellers.