Polygon bears in control – How traders can navigate the market
POL, the Polygon Ecosystem Token, has formed lower highs and lower lows - characteristic of a downtrend?
- POL has slowly trended downward since December.
- The technical indicators and spot netflows signaled a bearish bias.
Polygon [POL], the Polygon Ecosystem Token, has struggled for bullish traction in recent weeks.
The volatility of Bitcoin [BTC] did not help — POL slid lower alongside BTC, but failed to register sizeable gains when BTC climbed higher.
In a post on X, popular crypto analyst Ali Martinez pointed out that the POL utility token was trading within a range since December. This range extended from $0.414 to $0.531.
AMBCrypto had an alternative finding on a higher timeframe, which had bearish implications.
Parallel channel, yes, but a more bearish kind
AMBCrypto agreed with Ali on the parallel channel formation, but found that on the daily chart, POL was trading within a descending channel.
This implied a downtrend, which the price action also reflected over the past month.
The token has formed lower highs and lower low as 1-day trading session closes since December. Its Awesome Oscillator showed bearish momentum has been dominant over the past month.
The accumulation/distribution indicator was stuck within a range, and has not formed new lows compared to December.
On the other hand, the CMF was at -0.15. This was lower than what the indicator reached in late December on the same timeframe. This finding cemented the stern bearish pressure on the token.
To the south, the $0.418 and $0.414 levels could act as support.
The spot inflows saw some outflows in mid-December, but have been muted since then. The inflows on the 21st of January were followed by a 5.9% price move downward over the next three days.
However, the outflows did not always correspond to price gains. Therefore, the consolidation or downtrend idea was still the prevailing sentiment.
Read Polygon’s [POL] Price Prediction 2025-26
POL traders need to be bearishly biased, or wait for bullish conditions before looking to trade the asset.
A daily session close above $0.464 and $0.507 would be a clue for swing traders to begin looking for long position entries.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
