warning: The results of the following analysis are the author’s opinions only and should not be considered investment advice
- MATIC has seen wild fluctuations over the past month
- It had bullish momentum even on the higher timeframes, and a move towards $1 was likely
MATIC made decent gains after dropping to $0.77 on November 21. During this time, bitcoin increased slightly from $15.6k to $17k. While MATIC had a bullish market structure, further gains could depend on Bitcoin’s mood.
Read MATIC’s 2023-24 quote
If Bitcoin can clear the resistance at $17.6K, it could push the altcoin market higher. Meanwhile, a move below $16.6K could see MATIC drop below $0.89. On the lower timeframes, MATIC offered a buying opportunity when it approached the lows.
Short term consolidation could see a test of the medium term and a move up to $1
In September, MATIC posted a bullish order block in the $0.73 area. This area is highlighted in cyan and has been a good demand area for the past few months. However, on the higher timeframes, MATIC was still stuck in a (yellow) range of $0.725 to $1.03.
This range was violently broken in early November when MATIC pumped up to $1.26. Just a few days later, the price plummeted as fear gripped the market. The collapse of FTX saw MATIC lose around 40% from $1.26 to $0.77.
Immediately after that, the price rebounded to $1.12 before retracing to $0.77. This volatility was great for shorter time frame traders, but it is also very risky.
Since November 30, the Polygon token has reduced volatility. It has been trading between $0.899 and $0.945 over the past week, within the lower time frame highlighted in blue.
The RSI was just above a neutral 50, not showing strong momentum in either direction, while the OBV has also been relatively flat in recent weeks. There was no strong trend, although the daily market structure was bullish. Meanwhile, the Bollinger Bandwidth fell sharply to indicate lower volatility.
MVRV is back in negative territory after strong profit taking in November
The MVRV ratio (365 days) appeared briefly in positive territory in early November but stabilized again. This showed strong profit taking last month. At the time of this writing, MVRV has once again seen a sharp decline.
Meanwhile, development activity has increased strongly. This showed long-term investors that the developers were doing their business regardless of price movement, which was an encouraging result.