Short-term MATIC price analysis suggests a correction is underway. However, a bullish pattern in the 4-hour chart highlights the possibility of a bullish reversal. However, traders must be cautious in taking a forward when the pattern ends to avoid any traps in the chart.
Main technical points:
- MATIC price struggles to rise above 20-day DMA
- Selling pressure increases as prices suggest an evening star formation
- MATIC intraday trading volume is $1.21 Billion, showing a decrease of 9.275%.
The source- Tradingview
MATIC price rose to the $2.5 resistance level after finding demand at the confluence of the $2 level and the support trendline. However, the price action shows an evening candlestick pattern that proves a 4% rejection from the high selling pressure area.
The support trendline maintained the uptrend leading to a 20% increase in price from where it started. Therefore, the retracement might stop near the trendline.
Furthermore, the 20-day DMA acts as a dynamic resistance that helps control the recent bullish attack. However, continued support from the 100-day DMA helps bring the upside in action.
The Moving Average Convergence Divergence shows a free fall in the MACD and the signal lines in the daily chart. However, the bearish distribution in the bearish chart indicates an underlying bearishness.
MATIC Price Action Hints Bullish Breakout
The source-Traditionalingview
The MATIC price action forming a cup and handle pattern on the 4-hour chart. The neckline of the pattern is at the horizontal level of $2.40. Therefore, a jump above the neckline will start a new rally.
The drop in volume during the pattern’s handle formation reflects momentum trapping. Therefore, a breakout of either side will release trapped momentum and lead to a strong directional move.
Price action shows an important supply high for MATIC price of $2.84 following a neckline of $2.40 in the 4-hour chart. Meanwhile, demand is at $2.20 and $1.80.