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Polygon’s short-term momentum faces strong resistance – Here what next?
The recent surge in Polygon’s price has given the cryptocurrency a bullish structure on the 4-hour timeframe. However, the token’s short-term momentum faces significant resistance levels that may hinder its further upward movement.
Over the past two and a half days, Polygon’s price has gained 15%, a clear indication of strong buying pressure in the short term. This sudden increase in price is evident from the RSI (Relative Strength Index) on the 4-hour chart, which has shot higher into overbought territory at around 84.
The OBV (On Balance Volume) also reflects the growing demand, having reached a new high compared to the past two weeks. As a result, Polygon has been able to break above the local resistance level at $0.22 marked in orange on the chart.
Despite this positive short-term momentum, it is crucial for investors and traders to recognize that the overall trend remains bearish on both the daily and weekly charts. This means that any potential upward movements are likely to be met with strong resistance.
The Fibonacci retracement levels further support the notion that any attempts at a rally will face stiff opposition. A price above $0.26 could potentially shift the 4-hour swing structure to bullish, but this would require the cryptocurrency to overcome significant hurdles around $0.265 and $0.285.
For now, bulls should exercise caution before entering long trades amid this momentum. Instead, they may wish to observe Polygon’s reaction at these key resistance levels to determine whether a bearish reversal is more likely.
While it may be tempting to ride the current wave of buying pressure, investors would be wise to consider the bigger picture and the token’s overall trend.
Source: https://ambcrypto.com/polygons-short-term-momentum-faces-strong-resistance-here-what-next/
