Polygon Price Prediction: MATIC Prints Double-Top Pattern Threatening Freefall to $0.8
- Polygon's remarkable recovery halted at near all-time highs as declines loom.
- A double-top pattern on the four-hour chart is a vivid bearish signal.
After an incredible recovery, Polygon has embarked on a massive gains-trimming exercise that saw it lift from $0.8 to $2.44. The impressive growth in the past few days made MATIC one of the most-improved altcoins in the market.
However, bulls came very close to brushing shoulders with the all-time high of $2.5 but lost steam, leading to the ongoing retreat. At the time of writing, Polygon trades at $1.77 while seeking immediate support at the 50 Simple Moving Average (SMA).
Polygon reacts to a highly bearish technical pattern
MATIC has printed a double-top pattern on the four-hour chart after failing to break the seller congestion zone at $2.5. Note that this is an exceptionally bearish technical pattern that comes into the picture after an asset hits a high price point a couple of times. It is essential to realize the moderate price drop between the peaks.
The double-top pattern confirms in technical analysis when the asset drops price under a support level that is relatively equal to the low between the preceding two highs. Identification of a crucial support level helps to avoid false double-top patterns.
MATIC/USD four-hour chart
At the time of writing, the 50 SMA is the essential support, aided by the nearby 100 SMA. If Polygon loses this anchor zone, massive sell orders will come into the picture amid investor panic. The following tentative support area would be at $1.3, but if push comes to shove, MATIC will explore the area heading to $0.8.
Besides the bearish technical pattern, short-term indicators such as the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI) drive the correction narrative. The former is characterized by the MACD line (blue) crossing under the signal line. A progressive movement to the mean line (0.00) will keep the sellers' influence on the token at the roof.
Similarly, the RSI shows that bearish pressure is getting aggressive, as observed by the retreat from the overbought. As long as this trend strength indicator keeps the negative gradient, downward price action will prevail.
On the other hand, support at the 50 SMA may hold, sabotaging the expected downswing. Moreover, bulls will have the opportunity to focus on staging another recovery mission and perhaps this time trade a new record high.