While this outlook is positive, the Relative Strength Index suggests that Polygon MATIC price has recently tagged the 44.95 level and is in for a bounce. Interestingly, Polygon Matic ricocheted off the same barrier before it began its exponential price upswing in late December 2020.

If RSI closes above the declining trend line channel that connects the lower highs formed since MATIC price’s all-time high in May 2021, it will serve as a secondary confirmation to the start of a Matic bull rally.

Technicals hint massive gains for Polygon

Moreover, the Moving Average Convergence Divergence shows a recovery as the MACD or the fast-moving line (blue) is climbing higher while the slow-moving line (orange) is declining. If this trend continues, the MACD line will move above the blue line, indicating a bullish crossover that adds a tailwind to the scenario mentioned above.

On-chain metrics reveal the resistance-free path

IntoTheBlock’s Global In/Out of the Money model shows that Polygon MATIC price has few non-threatening resistance levels to clear. As seen in the chart below, a decisive daily candlestick pattern close above $1.74 level will push the 33,710 addresses that purchased 211.79 million MATIC tokens from “Out of the Money” to “Into the Money,” relieving the sell-side pressure and serving as a tailwind to the optimistic outlook.

On the other side, the 365-day Crypto Market Value to Realized Value model for Polygon is hovering around 66.8%. This on-chain metric is used to identify if the holders that purchased MATIC price over the past year are in profit/loss. Matic's higher MVRV number is bearish since it suggests a large number of investors are in profit and might be inclined to book profits by selling.

While 66.8% is relatively high, the MVRV history for MATIC price shows that a local top typically occurs around 146% as it did in April 2020 and 350% as seen during the 2021 bull rally.

Although the targets for Polygon price might seem unattainable, investors should note that the last quarter has been great for bull runs from a historical perspective. Regardless, the bullish outlook for Polygon Matic is dependent on the assumption that the buyers will push MATIC price to slice through the pennant’s upper trend line at a price of $1.543. However, a failure to do so could indicate a weakness among buyers.

Moreover, GIOM also reveals that the support levels are scarce up to the price of $1.05. Therefore, a potential spike in selling pressure that pushes Polygon Mattic to shatter the lower trend line at $1.14 will result in a bearish breakout. If this downswing produces a lower low below the price of $1, it will invalidate the bullish thesis.

In such a situation, MATIC's price might correct 30% to tag the $0.733 support level floor.

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