The underperforming token is, nevertheless, flirting with key resistance area to pursue a breakout.
Favorable fundamentals hint a near-term bullish scenario for the cryptocurrency.
Matic, a cryptocurrency that underwent a huge pump-and-dump last year, has been unable to revive its bullish momentum in 2020.
The low-cap token bottomed at 154 sats in Mid-March after a Coronavirus-induced panic sell crashed the entire cryptocurrency market by 55 percent. While the top assets later rebounded impressively, MATIC managed only to recover to as high as 192 sats – by about 24.68 percent.
MATIC/BTC testing key resistance levels for a breakout | Source: TradingView.com, Binance
As shown in the chart above, the 192 sats-level coincides with converging resistance levels taken from two different Fibonacci retracement levels. The first resistance level – of 195 sats – falls in line with the 78.6% level of the first retracement graph, while the second level – of 193 sats coincides with the 23.6 level of the second retracement graph.
MATIC is attempting to close above 192-195 sats area to confirm a breakout trend. And traders could move the prices above the range as the market braces itself for an upcoming bullish event.
Matic Team Announces 100% Staking
The MATIC team announced earlier in April that it would direct 100 percent of its 1.2 billion unlocked tokens for staking. Moreover, the tokens will become a tool to grow the MATIC ecosystem via a series of initiatives, including Dapp promotions, investments, grants, and Matic Mitra.
“89% of tokens unlocked on 26 April 2020 are NOT to be released into the market,” read the project’s official blog post. “Only ~1.3% of the total supply, the Advisory tokens (133,000,000), will actually be distributed. Of these, our advisors have committed to voluntarily deploy at least 50% of the tokens to stake.”
As the development team receives a bailout-like package to improve and grow the MATIC network, the supply shock could end up making the token scarcer at least in the medium-term. That could prompt traders to accumulate MATIC tokens at its current cheaper rate, soon leading it above the 192-195 sats area.
$MATIC Looks to be accumulating here for another pump at some point. pic.twitter.com/C8E1YHYfFb
— Trading Tank (@TradingTank) April 13, 2020
Upside Targets
Should the fundamentals play out, the MATIC price would close above the 192-195 sats area. This move would shift the bulls’ target to the range defined by October 2019 top of 212 sats and 38.2% Fibonacci level of the second graph at 217 sats. It could provide traders a decent opportunity to place a long position.
MATIC/BTC Upside Targets | Source: TradingView.com, Binance
Nevertheless, accompanying higher trade volumes could pump the MATIC price further towards the second 61.8% Fibonacci retracement level – at around 257 sats. Traders with higher risk appetite could extend their long positions towards 257-274 sats, providing they also maintain a stop-loss target below their entry point.
What do you think about MATIC’s upcoming price action? Tell us in the comment box below.
Photo by Livia Bühler on Unsplash