Polygon (MATIC) is currently one of the most intriguing charts in the crypto market. Despite recent market fluctuations, it has managed to hold the 48 cent level and has shown a promising recovery from recent lows. However, the question remains whether this recovery is a mere corrective bounce or a sign of a more significant breakout to the upside.
At present, it’s not entirely clear if the recovery is just a corrective bounce. Our expectation leans towards another low until we see a break above the minimum 78 cent level. This swing high, formed on a recent Friday, would be the absolute minimum we would want to see. Only then could we start discussing a possible first five-wave move up.
Doge2014 raises 500K in days celebrating Dogecoin. Make potentially big profits and get in on exclusive airdrop!
Show more +On a micro level, there is a possible five-wave move up, but it’s not significant enough to indicate a valid one-two setup. Therefore, we are currently observing and expecting another low until the price can show us a first valid impulse above 78 cents, followed by a subsequent three-wave pullback. This would allow us to count it as a one-two setup.
The current downward move is being watched as an ending diagonal. The idea is that in the fifth wave, we had a tiny A-B, and this is now a wave C. In the wave C structure, we can count it as a one-two, with the three, four, and five following. However, it’s also plausible to count this move down as complete, but this won’t be clear until the price gives us a signal above 79 cents.
Tactically, we have bought into the red candles with a small position and will get more aggressive on the long side as soon as we see the first five-wave move up. Then, we will measure support for the next three-wave pullback in a wave 2 and would then go long. Until then, we remain very careful and are watching if the 48 cent level breaks. If it breaks and sustains below it, that would not be a bullish signal anymore. Then, we are heading down, and the likelihood increases that we are going to see new bear market lows.
To keep the assumption alive that MATIC could have bottomed here already, the price must now stay above the 50.7 level. This analysis should provide you with all the levels required to understand the current market situation and make informed decisions about your investments in Polygon (MATIC).
