- MATIC retested $0.5 as resistance in a bounce that had little trading volume behind it.
- A drop toward $0.448 or lower is anticipated over the next week.
Polygon [MATIC] was in a downtrend like most other altcoins in the crypto market. It too saw a breakdown beneath a range like Bitcoin [BTC] did last week, and the bulls were having a hard time keeping the bears at bay.
The latest price slump to $0.44 caused enormous pain to investors, as this was the lowest price MATIC has traded at since June 2022.
The inability of the buyers over the past three months to defend the gains made earlier this year showed long-term bearish sentiment.
MATIC bulls forced an 18% price bounce over 36 hours
Source: MATIC/USDT on TradingView
After the sharp drop on Friday the 5th of July, MATIC bounced to the $0.5 psychological resistance level, but the trading volume was slim. The past few hours of trading saw MATIC bears begin to push prices downward.
On the 12-hour chart, the RSI has been below neutral 50 since early June, signaling a bearish trend in progress. This has not changed. The $0.543 and $0.518 are resistance levels that lower timeframe short sellers could wait for a rejection from.
The OBV continued to trend downward, highlighting the strength of the sellers since April. Combined with the price action, a move toward $0.44 and $0.393 could be brewing.
The funding rate has recovered but speculators are wary
Source: Coinalyze
On the 5th and 6th of July, the funding rate fell into negative territory, showing short sellers were dominant. Since then the funding rate has crept back above zero but did not show bullishness.
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The Open Interest also slid downward over the past few hours as MATIC met the $0.5 resistance, showing speculators preferred staying sidelined instead of buying MATIC.
The spot CVD has trended downward in July after witnessing some buying pressure in the latter half of June. Overall, the sellers are overwhelmingly strong and more price losses are likely.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
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