Polygon (MATIC) has emerged as one of the top performers in the crypto market, achieving a 9% gain within the last 24 hours. As of August 21, it ranks third among the top-100 cryptocurrencies by market cap. Over the past week, MATIC has seen a rally, accumulating a 23% increase in its value.
Crypto analyst World of Charts has highlighted that MATIC has broken out of a six-month-long downtrend. This breakout is seen as a crucial bullish signal, suggesting that MATIC could potentially surge towards the $1 mark. Historically, a descending channel in the context of a downtrend can indicate a reversal if a breakout occurs.
As of August 20, the Polygon price broke out from its descending channel at approximately $0.44. This breakout move is crucial for market sentiment and sets a new trajectory for potential price targets. Analyst predictions suggest the price could rise by more than 143%, pushing MATIC above $1.10.
MATIC's current price level needs to serve as a new support level to confirm the bullish outlook. If MATIC maintains this level and performs a successful retest, it could further confirm the bullish trend. However, a drop below the trend line might indicate a false breakout, leading to a reassessment of the bullish scenario.
Additionally, investors should monitor trading volume and market sentiment, as these factors will play significant roles in sustaining the upward momentum. An increase in trading volume typically accompanies genuine breakouts, providing further confirmation.
A catalyst for another Polygon rally is the upcoming migration from MATIC to POL, scheduled for September 4. This upgrade is expected to enhance the functionality of Polygon’s native token, making POL a principal gas and staking token of the Polygon PoS network, thereby playing a critical role in network security.
