Since late March, Polygon has been showing a continued downward trajectory on the charts, with the £0.96 region switching from demand to supply in May. The MATIC chain’s number of unique addresses has plummeted by an incredible 85%. Whale trades were also on the decline.
This indicated a declining network, which was also reflected in the price charts.
On the H12 chart, the downtrend began in late March with a succession of lower highs and lower lows. MATIC climbed from £1.9 lows to £1.37 highs during the mid-March rally. It did break slightly above a prior lower high at the time, and for a few days, it hinted at the start of a bullish market. The bulls, on the other hand, failed to hold the £1.27 support level and plummeted through it early in April.
In May, when the price fell below the demand zone of £0.96 and retested it as resistance, the case was not different. The £0.80 level was unable to serve as a long-term support.
On the charts, the bears are exceedingly strong, and despite smaller timeframe rallies, the downtrend appears to be set to continue. In the last two months, both the 55-period moving average nd the 21-period SMA have acted as resistance. To break the previous lower high, the price would have to advance over the 55 SMA as well as the £0.60 level.
A series of higher highs on the RSI, whereas a series of lower highs on the price chart appeared.
This is a concealed bearish divergence in the making, indicating that the downtrend will continue.
The RSI was below neutral 50 at the time of writing, indicating that bearish momentum was still prevailing. The OBV fell sharply in May, and despite making higher lows in recent weeks, there was little evidence of sufficient demand to reverse the downtrend.
The CMF above the +0.05 level is indicating a significant inflow of capital into the market.