- MATIC price has breached a historical support level at $1.015 and hints at continuing this trend.
- This development opens the path for a 52% correction to $0.467 and fill the inefficiency present below.
- A three-day candlestick close above $1.750 will create a higher high and invalidate the bearish thesis for Polygon.
MATIC price stumbles its opportunity to bounce, catalyzing a bearish move. This development could cut Polygon’s market value in half.
MATIC price at risk of another crash
MATIC price created a range, extending from $0.745 to $2.435 as it rallied 227% between May 22 and 25. After a sweep of the range low on July 18, 2021, the altcoin rallied 370% and swept the range high on December 21, 2021.
A failure to sustain the momentum led to a 65% crash, which pushed MATIC price down to a crucial support level at $1.015. While a bounce here was likely, the bearish market conditions caused a breakdown of the said level.
As a result, MATIC price is open to crashing another 21% to retest the range low at $0.745. In some cases, if the selling pressure spikes quite a bit, there is a good chance that Polygon could stoop lower.
This downswing could allow market makers to fill the price inefficiency known as the fair value gap at $0.467, bringing the total downswing to 52%
MATIC/USDT 3-day chart
Surprisingly enough, IntoTheBlock’s Global In/Out of the Money (GIOM) model supports this bearish outlook. This index shows that roughly 30,000 addresses that purchased nearly 1.8 billion MATIC tokens at an average price of $0.473 are “Out of the Money.”
Therefore, a dip into this barrier is likely to be supported by these investors, who could decide to buy more, alleviating the selling pressure.
MATIC GIOM
Regardless of the extremely bearish outlook of the crypto market, a reversal or stabilization in Bitcoin price could push altcoins, including polygon higher.
In such a case, a three-day candlestick close above $1.75 will create a higher high and invalidate the bearish thesis for MATIC price. This move could open the path for a further ascent to retest the range high at $2.43.