- MATIC price has begun shaping the handle of a cup-with-handle base.
- Polygon extreme overbought condition on the daily Relative Strength Index (RSI) has been eliminated during the May crash.
- MATIC price came within 17% of the all-time time after a 230% thrust from the May 23 low.
MATIC price remains at the vanguard of the cryptocurrency market, despite the 75% crash this month. The rare rebound of 230% from the May 23 low and the emerging cup-with-handle base has positioned Polygon with the relative strength to print new highs in the coming days or weeks. Only an acceleration in the selling of cryptos will derail the bullish outcome.
MATIC price embraces the growing hype around Polygon
Up to May 19, MATIC price led the cryptocurrency complex higher following a decisive breakout from a multi-week consolidation shaped during March and April. The Polygon breakout was accompanied by a notable surge in volume and yielded overbought daily and weekly RSI conditions.
From May 19 to May 23, MATIC price declined 75% before striking support at the 50-day simple moving average (SMA) at $0.791 and just above the 61.8% of the April-May rally at $0.693, as well as the 2021 rising trend line at $0.645.
MATIC price matched the significant correction with a massive rebound of 230%, setting the foundation for the developing cup-with-handle base. The right side of the Polygon base is characterized by double-digit up days on solid volume, and the handle component is forming in the upper half of the base on below-average volume. The handle may need an extra amount of time due to the price compression generated by the steep decline and rapid rebound.
Once the handle is complete, Polygon is primed to break out from the cup-with-handle base with a measured move target of $8.290 from the handle high of $2.482, yielding a 230% gain for accomplished investors.
In the path of the measured move target is the 138.2% extension of the May correction at $4.984 and then the 161.8% extension at $6.90.
MATIC/USD daily chart
Unfortunately for keen Polygon investors, MATIC price could become entangled with a new wave of selling pressure in the cryptocurrency market. Levels of support include the 50% retracement of the rally from the May 23 low at $1.358, the 61.8% retracement at $1.178 and the May 19 low at $1.011.
Long-term, MATIC price will be buoyed by the growing recognition of Polygon as a blockchain network with built-in scaling solutions for projects, as well as the recent Google BigQuery announcement and the much-discussed investment by Mark Cuban. It makes it a challenging target for bearish investors.
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