Polygon Breaks Through $0.85, Is A Move To New Highs Next?
December 22 2023 - 11:30AM
NEWSBTC
Polygon has seen some sharp uptrend during the past day and has now
broken above $0.85. Here’s why this break could pave the way for a
further rally. Polygon Has Risen By More Than 6% During The Past 24
Hours After topping above the $0.94 mark earlier in the month,
MATIC had gone on to register some significant drawdowns. In the
last few days, though, the asset appears to have hit a bottom
around the $0.75 level, as it hasn’t gone below the mark yet.
Related Reading: Analyst Says Polygon (MATIC) On Brink Of Major
Move, Here’s Why Something that could add further evidence for this
is the fact that bullish momentum has returned for Polygon in the
past day, as its price has shot up over 6%. The below chart shows
how the cryptocurrency has performed during the past month: Looks
like MATIC has sharply risen in the past day | Source: MATICUSD on
TradingView With this sharp surge, the cryptocurrency has recovered
back above the $0.85 mark. This break could turn out to be
significant for Polygon if on-chain data is anything to refer to.
MATIC Has Broken Past A Major Resistance Zone With The Latest Surge
In a post on X, analyst Ali discussed about how Polygon was about
to face a major test of on-chain resistance. When the analyst had
made the post, the coin was still trading around the $0.78 mark.
Here is a chart that shows how the on-chain support and resistance
levels looked like at the time of the post: The different MATIC
price ranges based on the density of cost basis | Source:
@ali_charts on X In on-chain analysis, the potential of any price
range to act as support or resistance depends on the number of
coins that the investors purchased inside the particular range.
This is because of the fact that holders are more likely to react
whenever the price retests their cost basis or acquisition price,
as such a retest can flip their profit-loss condition. The more
addresses that have their cost basis inside a particular range, the
stronger the market reaction when the price retests said range.
From the chart, it’s visible that Polygon’s price had been trading
just under the $0.79 to $0.84 range at the time Ali had made the
post. This range carried the cost basis of around 38,570 addresses,
which bought 4.24 billion MATIC at it. Generally, whenever the
investors are in a loss (as these holders would have been when
MATIC was trading under the range), there is a chance that they
sell when the price retests their cost basis since they might get
desperate to exit the market and break-even would sound like a good
opportunity to do so. Related Reading: XRP Whales Show Exchange
Inflow Activity, Bad Sign For Price? As a result of this, price
ranges above the spot price that are dense with investors can
provide resistance to the cryptocurrency. This had made the
aforementioned thick $0.79 to $0.84 range important for Polygon.
“For MATIC to embark on a journey to new heights, it’s crucial to
break through this level with conviction,” the analyst noted in the
post. Following the latest surge, MATIC has clearly surged past
this major obstacle. And as is visible in the graph, there aren’t
any ranges this difficult to break anymore, either. It now remains
to be seen how the Polygon price develops from here, given the
lower on-chain resistance at the levels above. Featured image from
Shutterstock.com, charts from TradingView.com, Santiment.net
Polygon (COIN:MATICUSD)
Historical Stock Chart
From Sep 2024 to Oct 2024
Polygon (COIN:MATICUSD)
Historical Stock Chart
From Oct 2023 to Oct 2024