Polygon stands tall in the sell-off market: Will MATIC reach $2?
In the long-term, Polygon has been in an uptrend, but it faced a sudden bearish momentum when FTX announced the liquidity crisis on their exchange. As a third popular crypto exchange, FTX is facing a liquidity challenge that leads to selling pressure in crypto markets.
Binance came to the rescue, but on Wednesday, Binance announced that they would not acquire FTX because the liquidity crisis was beyond their control. As a result, the SEC and U.S. Congress will investigate the FTX issue, and that is why the crypto markets will be volatile for the next few weeks.
Polygon is a leading layer-2 scaling protocol on the Ethereum network. That is why it has bounced back quickly with a bullish engulfing candle, and now it has regained the previous support level. It suggests investors have gained confidence in MATIC, whereas many other cryptocurrencies are still in a downtrend. It suggests the potentiality of the MATIC coin for the long term.
Polygon has been consolidating in the last four months, but this news came as a new challenge to the crypto world, and many retail investors started selling out of panic because they were worried about the sustainability of such a new technology. Indeed, some of the cryptocurrencies have bounced back quickly; Polygon is one of them.
Experts believe that the FTX liquidity crisis is not a major issue (rather, it is an internal issue of the platform), and it does not have a long-term effect, so investors have gained confidence in their favorite digital assets. However, some other experts believe the US FED has been hiking the interest rate, and the outflow from the crypto economy will continue even in the next year. Read our MATIC prediction to know how the token will react in this volatile market!
On the daily chart, we can find too much volatility for the short term. After facing the resistance of around $1.25, MATIC reached strong short-term support of around $0.76 within 24 hours. Now it is trading around $1, and candlesticks are forming around the baseline of the Bollinger Bands.
Most technical indicators are neutral at this time, so we do not think it is an ideal time to invest because Polygon may break the support and find lower support around $0.5.
However, the weekly chart of MATIC has been forming higher highs, so $1 will be a crucial level for the long term. Indeed, you can accumulate some coins at this level, but we think you should wait for a few days until Polygon gains momentum. After that, you can invest for the long term.