Polygon faces resistance at its long-term resistance level
On the weekly timeframe, it is evident that MATIC price reached its highest point in December 2021 and has since been on a declining trend, staying within a descending resistance line. This downward movement reached its lowest point in June 2022 at $0.32.
The price of Polygon has seen some recovery since then, but it is still trading below the descending resistance line. Starting in November 2023, the token has attempted four bullish breakouts (indicated by red icons), but all have been unsuccessful, leading to a retracement.
Source: TradingView
The weekly relative strength index (RSI) is also declining, although it is still above the neutral level of 50, indicating an unclear trend.
The Polygon team has announced that they will be holding a Discord meeting tomorrow to discuss the benefits of their AggLayer solution.
Previously, BeInCrypto reported that the team had developed a protocol that aims to eliminate the barriers between blockchains and work with other networks without the need for bridges. The AggLayer project aims to create a unified environment, or “web of networks,” similar to the Internet. The launch of this project is scheduled for February this year.
MATIC forecast: Can the price avoid a bearish breakout?
Similar to the weekly timeframe, the daily chart also indicates a bearish forecast for MATIC. The price has been declining below the descending resistance line since the beginning of the year.
Just recently, the price once again bounced off this trendline (indicated by a red icon), resulting in a bearish candle formation. This coincided with the RSI rebounding from the 50 barrier (represented by a red circle).
Crypto trader Crypto Rover acknowledged the significance of this trendline but suggested that eventually, the price will experience a bullish breakout.
Despite being below the descending resistance line, MATIC is still above the horizontal support area at $0.72. If this support area is breached, a potential 20% fall to the nearest support level at $0.60 could occur.
Source: TradingView
Despite the bearish outlook, a bullish breakout above the trendline could result in a 35% rally for Polygon, leading to a high of $1.05.
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