Would you buy the MATIC price drop at $0.45
- The MATIC price broke through an all-time support level at $1.015 and hints at the continuation of this trend.
- This move paves the way for a 52% correction to $0.467 and closes the inefficiency present below.
- A three-day candlestick close above $1.750 will create a higher high and invalidate Polygon’s bearish thesis.
MATIC price stumbles on its opportunity to rebound, catalyzing a bearish move. This development could halve the market value of Polygon.
MATIC price risks another crash
The MATIC price created a range, stretching from $0.745 to $2.435 as it rose 227% between May 22-25. After a sweep of the low range on July 18, 2021, the altcoin rose 370% and swept the high range on December 21, 2021. .
A failure to maintain momentum led to a 65% crash, which pushed MATIC price to a crucial support level at $1.015. While a rebound was likely, bearish market conditions caused said level to break.
As a result, the MATIC price is likely to drop a further 21% to retest the low of the range at $0.745. In some cases, if the selling pressure increases a bit, there is a good chance that Polygon will drop.
This decline could allow market makers to close the pricing inefficiency known as the fair value gap at $0.467, bringing the total decline to 52%.
MATIC/USDT 3-day chart
Surprisingly, IntoTheBlock’s Global In/Out of the Money (GIOM) model supports this bearish outlook. This index shows that around 30,000 addresses that bought nearly 1.8 billion MATIC tokens at an average price of $0.473 are “out of the money”.
Therefore, a dip in this barrier is likely to be supported by these investors, who may decide to buy more, easing selling pressure.
Regardless of the extremely bearish outlook for the crypto market, a reversal or stabilization in Bitcoin price could drive altcoins, including Polygon, higher.
In such a case, a three-day candlestick closing above $1.75 will create a higher high and invalidate the bearish thesis of the MATIC price. This move could pave the way for a further climb to retest the high range at $2.43.