MATIC increased from $0.88 to $1.26 in a week in early November, representing roughly 50% gains. MATIC fell 41% to $0.76 four days after reaching its top in this rally. Can higher timeframe traders profit from current volatility?
Lower timeframe traders will most likely be ecstatic as a result of the recent dramatic price changes. With Bitcoin going below the $16.2k support level, it appeared like the entire market could take another tumble. In this context, MATIC presented a purchasing opportunity. Can the buyers maintain their position in the next weeks?
Range low and bullish order block once more as bulls and bears skirmish near $0.79
MATIC traded within a range (yellow) from $1.03 to $0.72 since mid-July. The sharp breakout in early has rapidly reversed two weeks ago. At that time, the technical indicators leaned in favor of the bulls. The Relative Strength Index (RSI) shot into overbought territory while the Chaikin Money Flow (CMF) and Accumulation/Distribution (A/D) indicator also saw a decent uptick. However, all of this took a bearish shift in the past few days. The CMF and A/D declined, while the RSI retested neutral 50 as resistance to show downward momentum.
On 21 September, the daily trading session formed a bullish order. It was near a significant level at $0.74, and the price action in late September showed a bullish market structure development. This order block was highlighted in cyan, and it has been tested twice since then. Both times saw a strong bullish reaction. Can the bulls deliver another performance like that, or will they finally succumb?
A revisit to the $0.74-$0.76 region will likely offer a buying opportunity. Invalidation would be a daily session close beneath $0.68, with targets being $0.88 and $1.03 to take profit at. However, the Bollinger Bands were wide. Even though a visit to the lower band at $0.69 can be bought in the hopes of a mean reversion, buyers would need to be cautious, especially given Bitcoin’s weakness on the charts.
Development activity on the rise over the past year, and network growth also witnesses a huge surge
In November, the network growth metric and the development activity both reached their highest points in the past year. These are metrics that longer-term investors pay some attention to, hence a bullish long-term case can be made for MATIC.
The 365-day Market Value to Realized Value (MVRV) witnessed a surge since May but was not yet in positive territory. It briefly breached the 0 mark on 7 November, but the subsequent selling pressure put longer-term holders at a loss once more.