Polygon sees a bearish breakout, will MATIC hit a new year low?
Polygon sellers seemed to gaining dominance in the market as depicted by MATIC's price action. Will MATIC hit a new all time low?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Sellers seized the momentum with a bearish breakout from the compact range.
- Liquidation data highlighted shorts leverage.
Polygon [MATIC] broke out of its sideways structure on the higher timeframes with the selling pressure taking it to the $0.5 support level.
Realistic or not, here’s MATIC’s market cap in BTC terms
An earlier report by AMBCrypto on MATIC’s price action highlighted the possibility of a bearish breakout from the compact range. This analysis was validated with MATIC dropping by 9.7%.
However, the $0.5 support has held up in the short term and could provide a base for bulls to rally again in the long term.
Bears gained the upper hand after a range-bound price movement
MATIC’s price action stalled after bulls were rejected at the $0.6 price zone in early October. This led the altcoin to trade sideways between $0.55 to $0.6 from 1 October to 8 October.
Sellers finally secured a bearish breakout on 9 October with the selling pressure sinking MATIC toward the year lows of $0.5. The descent of price to the $0.5 level marked the third time the level will be re-tested within the period of a month.
This highlighted the growing selling pressure which could result in a new year-low for MATIC.
In the meantime, the Relative Strength Index (RSI) reflected the selling pressure, as it remained under the neutral 50 with a reading of 36. Likewise, the Chaikin Money Flow (CMF) recorded massive capital outflows to strengthen sellers’ leverage.
Shorts profited from bearish breakout
A look at the exchange liquidation data over the past day revealed significant profit for shorts after the bearish breakout. Longs suffered 76.8% liquidation from the total number of liquidations on MATIC over the period.
How much are 1,10,100 MATICs worth today?
This underlined the bearish strength currently in the market. Thus, MATIC bulls looking for a price rebound should actively track Bitcoin’s [BTC] price action for informed trade setups.
