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- MATIC has a solid bullish bias and a retest of $0.95 is likely to push the coin price higher once again.
- Some on-chain indicators have pointed to the possibility of increased selling pressure on the token.
Polygon (MATIC) broke the very important $1 resistance level on December 26th. It rose to $1.09 and was experiencing a decline at the time of press. This was good news for MATIC bulls.
AMBCrypto recently reported that zkEVM’s network activity has decreased despite rising TVL. The futures market has reflected strong bullish sentiment recently, and this trend could continue if MATIC defends the $0.95-$1 support zone.
The MATIC market structure showed that big gains could be imminent.
Source: MATIC/USDT on TradingView
The 1-day chart has formed higher lows and higher highs since December 23rd. The token has been trading within an extended range (purple) since mid-November, from $0.934 to $0.722. Therefore, the recent breakthrough signals optimistic intentions.
OBV was trending upward and RSI was above neutral 50. Together, these two showed that the buyer was in control. The Fibonacci retracement levels of $0.9218 and $0.8813 are close to the range highs and previous bearish order blocks.
This zone is now a bullish breaker and demand zone on the 1-day time frame.
It was also home to a fair value gap (in white), marking the $0.93-$0.98 area as an area of interest for swing traders. The confluence of factors has created a strong buying opportunity northward targeting the Fib extension levels of $1.17 and $1.3.
Weighted sentiments soared along with prices.
Source: Santiment
AMBCrypto noted that despite the strong rally since October, the average coin age has not shown a consistent upward trend. This suggests that holders are more keen on securing profits than riding the wave higher.
However, in recent days, the weighted sentiment on social media has been very positive due to the price action.
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Dormant circulation saw a big spike on December 11th, a sign of selling pressure. This led to a retracement.
Another spike in this indicator is something traders should watch out for. The MVRV ratio is also close to its October high, meaning MATIC is an overvalued asset whose holders can expect to profit.
Disclaimer: The information presented does not constitute financial, investment, trading or any other type of advice and is solely the opinion of the author.