Crypto analyst Ali has identified a reversal pattern for Polygon (MATIC), the 14th largest cryptocurrency by market capitalization. If this pattern continues to play out, MATIC could potentially see a 16% price decrease.
According to Ali's analysis, MATIC appears to have formed a head-and-shoulders pattern on its four-hour chart. In the realm of technical analysis, a head-and-shoulders pattern is a chart formation that often signals a shift in the prevailing trend. This pattern consists of a baseline with three peaks, with the two outer peaks being roughly equal in height and the middle peak being the highest.
Should the price of MATIC sustain a candlestick close below the pattern's neckline at $0.79, it could trigger a 16% correction, bringing it down to $0.67. However, the bearish outlook would be invalidated if MATIC experiences an upswing above the right shoulder, which is at $0.86.
MATIC had recently surged to a peak of $0.983 on November 14, following weeks of upward momentum driven by increased whale activity. Subsequently, MATIC underwent a profit-taking decline, hovering near the $0.77 level. A drop below this level could target the daily MA 200 support, situated around $0.679, and then potentially the daily MA 50 at $0.663.
On the other hand, if MATIC manages to surpass the $0.86 level, as pointed out by Ali, it might set its sights on the $1 mark. At the time of the report, MATIC had experienced a 10.6% decline in the last 24 hours, bringing its price to $0.767.
Meanwhile, Polygon is actively progressing with its Polygon 2.0 initiative, which is a roadmap aimed at scaling Ethereum to become the foundational layer of the internet's value. In the previous month, the POL token upgrade was successfully launched on the Ethereum mainnet, representing a significant milestone for the Polygon blockchain.
