The altcoin market along with the Bitcoin market was seen surging on Tuesday. The price of Polygon’s MATIC was also witnessing a similar surge in the short term. However, considering the long-term picture of MATIC, traders may be at a decision-making point.
MATIC daily chart
Source: MATICUSD on TradingView
The daily chart of MATIC outlined the price sloping down since late May. The price dropped almost 55% in the past 35 days and found support at $1.06.
MATIC has not traded under the $1.06 price level for a while now, although it did recently test the support. At the time of press, MATIC was trading at $1.12 with a low trading volume, suggesting a period of consolidation.
Reasoning
Unlike the rest of the crypto market, MATIC’s market was seeing low volatility. Bollinger Bands had converged and the asset was trading within a restricted range. The movement of the asset was restricted when the signal line crossed over the candlesticks. The 50 Moving average also moved above the price bars suggesting that the asset was on a downtrend.
This downtrend has continued for a while now. Despite minimal recoveries, MATIC has remained bearish. The Directional Movement Index also affirmed this. However, despite downward pressure, DMI was suggesting a possible trend reversal as the -DI inched closer to the +DI, hinting at a possible crossover. This would mean that the upwards pressure was on the rise.
However, with ADX at 19, the trend reversal may not be sufficiently supported by the market. This could lead to an extended period of consolidation.
Conclusion
The current MATIC market has been noting a strong downtrend extending for over a month. This downtrend has flipped the bullish market into a bearish one and it may continue to keep the value low for some time.
