As the breakdown from a symmetrical triangle formation takes traction, the MATIC price is currently down 16 percent this week.
Moving forward, the May low of $0.743 must provide support, or else a more dramatic Polygon fall is in store.
The 50-week simple moving average has been tested or broken by the majority of cryptocurrencies (SMA).
MATIC price has been on a downward trend since May 19, which was verified by a drop below the 2021 ascending trend line on June 21 and a breakdown from a 50-day symmetrical triangular pattern on July 8. The May low of $0.743, the March high of $0.544, and the 50-week SMA of $0.380 stand in the way of a realization of the big measured advance. The 50-week SMA is very important in this scenario.
The fascinating underlying tale of the scaling solution on Ethereum had sustained MATIC pricing earlier this year, but the faltering cryptocurrency market has replaced interest in the Polygon legend.
MATIC price is now in a vulnerable position of outsized losses as a result of the turn of events. The 50-week SMA has been a source of support for most cryptocurrency coins, and in many cases, it has proven an impenetrable resistance level. Polygon would have to drop another 58 percent from its current price to align MATIC with the 50-week SMA at $0.380, erasing the rise that began in late April.
The negative, however, may not be confined to $0.380. The grand symmetrical triangle’s measured advance from the breakout point is nearly 75%, implying a final MATIC price of $0.251 and a decrease of over 70% from the present price. The 50-week SMA, the 38.2 percent Fibonacci retracement of the 2021 increase at $0.394, and the lows of the trading range that dominated Polygon in March-April at $0.287 would all be bested by a loss of that magnitude.
Weekly MATIC/USD chart
MATIC pricing has two goals to counteract the bearish narrative. First, get a daily close above the $.092 low from June 22nd, and then get a daily close above the $1.067 apex of the symmetrical triangle. Polygon may explore a test of the descending 50-day SMA at $1.332, which is a 24 percent gain from the apex, if it is successful.
The daily Relative Strength Index is a final evaluation (RSI). It’s getting close to an oversold rating, which might cause a rally. The oversold RSI will only momentarily halt the larger Polygon drop if MATIC price cannot close above the levels outlined above.
The downside resolution of the symmetrical triangle signaled a crucial inflection moment for MATIC pricing, requiring Polygon believers to consider a startling collapse, which most cryptocurrencies have previously experienced.
To be sure, a 60% drop to the 50-week SMA is a compelling scenario, especially when the cryptocurrency market as a whole fails to attract a strong bid./n
