The MATIC price was responsive to an overall altcoin rally, led by Bitcoin’s return above $38K. The mid-cap token has seen a 10% jump in the last 24 hours. However, the price was within a relatively high net zone and an oversold RSI could trigger selling behavior before MATIC closes above $1.60.
MATIC time period
A MATIC rally was underway after the price dropped to a 1-month low of $1,355 on Feb. A rebound from the daily support zone has put MATIC above its 20-SMA (red), with short-term momentum shifting in favor of the long side.
However, the MATIC price was crossing an important zone – one that could make or break its future direction. The Visible Range Profile observed a significant share of trades between $1.50 and $1.76. Furthermore, the highest trades were placed around $1.60, also called the Control Point. Areas that contain a high number of deals are considered more liquid than other tiers. Thus, price tends to travel at a slower rate within these zones as there is pressure from both buyers and sellers. A rally is often considered strong if the price can easily close above these areas. On the other hand, a rejection is considered a sign of weakness and can also lead to bearish reversals.
For MATIC, the critical control area was US$ 1.60. The presence of the hourly 200-SMA (green) made a breakout even more important. On the downside, a 23% decrease in trading volumes meant that MATIC’s rise was not supported by strong buying volumes. The current reading was not encouraging, especially when there is a major breakout in a bet. An oversold RSI further complicated the chances of a bullish outcome as it usually signals profit taking.
Several factors showed that MATIC did not have the necessary momentum to carry above $1.60. If the price fails to find support above $1.47 during the next bearish cycle, the market will be vulnerable to an 8% to 11% further selloff. The projected drop would drag MATIC back into a $1.35-$1.30 demand zone.