Polygon (MATIC) price has reached an important confluence of resistance levels between $1.25-$1.33. Its response may determine the future trend.
Polygon Networks is a scaling solution for the Ethereum blockchain, specializing in smart contracts. Its native token is MATIC. The weekly time frame shows that in February MATIC price moved above the $1.40 horizontal resistance area and declined shortly afterwards. However, the price formed a bullish candlestick last week, characterized by a long lower wick (green icon), ending the decline.
The price could make another attempt to reach the $1.40 resistance area. It is supported by the weekly RSI, which is rising and above 50.
However, if the rally consolidates, the price could move back towards the $0.80 horizontal support area.
Has Polygon (MATIC) Price Started a Relief Rally?
Technical analysis on the daily time frame shows that MATIC price is still correcting previous upward momentum. If so, it is currently in a relief rally, which will be followed by another decline.
It looks like MATIC token price has completed a five-wave upward movement (black). It confirmed this with a break from an ascending support line. This led to a low of $0.94 on 10 March. Later, the price formed a bullish hammer candlestick and retested the 0.618 Fibonacci retracement support level at $1.06. This is a bullish signal.
However, the price is now trading near the 0.5-0.618 Fibonacci retracement resistance (white) level at $1.25-$1.33. If the rise is indeed a B wave rally, the area could act as a top. Besides, the daily RSI was rejected by 50 (red icon).
Therefore, the reaction of the $1.25-$1.33 area may determine the future trend direction. Rejection from the area would also lead to an RSI rejection. In that case, a further drop below $1 can be expected. A conclusive response is likely in the next 24 hours.
However, if MATIC price manages to break above, it could move higher to $1.93.
To conclude, the direction of the future MATIC price trend is undecided. Whether the price breaks or gets rejected from the $1.25-$1.33 area will determine whether the trend is bullish or bearish. A close above this area could lead to a rise towards $1.93 while there could be a rejection towards $0.90.
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