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The daily chart reveals intriguing price action for POL, signaling a potential reversal in the near term. After completing a five-wave impulse culminating at $0.76 on December 3, POL underwent an ABC correction within a descending flat triangle. The correction found a low at $0.41 on January 13, and since then, the price has shown signs of recovery.
Currently trading slightly above the $0.42 support—formerly a resistance level—POL hovers at a critical pivot point. If this level holds, it could pave the way for a new five-wave impulse, supported by technical indicators.
Technical Outlook
From November 4 to late December, POL rose sharply from $0.30 to $0.76, marking a 70% increase. Following the correction, the current price tests the $0.42 horizontal support zone. The Relative Strength Index (RSI) on the daily chart sits neutral, indicating a lack of decisive momentum. However, the 1-hour RSI at 44 suggests oversold conditions, hinting at a possible upward rebound.
Bullish Scenario
The 1-hour chart supports the idea of a new five-wave impulse forming. Wave (i) appears to have peaked at $0.51, while wave (ii) retraced to $0.42. If POL holds this support, wave (iii) could push past the descending resistance to target $0.60, aligned with the Fibonacci extension level of 1.618. A sustained move above $0.47 would signal bullish momentum.
Bearish Risk
Failure to maintain the $0.42 support could see POL revisiting the lower boundary of its horizontal zone at $0.30. A drop below $0.41 would invalidate the bullish outlook.
Key Levels to Watch
- Immediate Resistance: $0.47
- Secondary Resistance: $0.51
- Critical Resistance: $0.53
- Immediate Support: $0.42
- Critical Support: $0.41
Also Read: Polygon: Revolutionizing Ethereum Scalability with Lower Gas Fees, Faster Transactions, and Seamless Interoperability
With POL at a pivotal juncture, traders should monitor key levels closely. A decisive move above resistance could confirm a bullish reversal, while a break below $0.41 would shift the sentiment bearish.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
With a keen eye on the latest trends and developments in the crypto space, I’m dedicated to providing readers with unbiased and insightful coverage of the market. My goal is to help people understand the nuances of cryptocurrencies and make sound investment decisions. I believe that crypto has the potential to revolutionize the way we think about money and finance, and I’m excited to be a part of this unfolding story.
