MATIC Price Analysis: The Rising Parallel Channel Pattern Hints At Another 25% Correction In This Rally

The MATIC coin price action respects the levels of a raising parallel channel pattern. After rejecting from the overhead resistance of the pattern, the coin should travel to the bottom support trendline projecting a 25% fall ahead. However, the Polygon team shared a positive news in the market with its recent announcement regarding the acquisition of a start-up company Predictable Labs, in a staggering $500 million deal.

Key technical points:

• The MATIC price obtains strong support from the 100-day EMA 
• The daily RSi chart shows a clear bearish divergence concerning the coins price action
• The intraday trading volume in the MATIC coin is $3.37 Billion, indicating a 6.7% loss

Source- MATIC/USD chart by Tradingview

The last time when we covered the MATIC/USD, the coin price fairly survived the blood bath of December 4th and, in return, indicated the presence of intense demand pressure with a long lower price rejection candle. Thus, this resulted in price retesting the overhead resistance of the ascending trendline.

Furthermore, the price faced strong rejection from this level, displayed by a long bearish engulfing candle. A rejection from the top resistance of this pattern should lead the price to the bottom trendline, which is 25% below. 

The MATIC coin price maintains bullish sentiment due to the bullish alignment of the crucial EMA levels(20, 50, 100, and 200). Moreover, the 100 EMA line provides strong support for the coin price.

The Relative Strength Index(57) shows a bearish divergence in its chart, indicating weakness among the market sellers.

MATIC/USD 4-hour Time Frame Chart

Source- MATIC/USD chart by Tradingview

After rejecting from the above resistance, the MATIC coin price breached the first support level of the $2.2 mark. The coin price is currently trying to retest this new resistance, which will better confirm whether the breakdown and reversal are genuine.                                                       

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