Friday, December 2, 2022

Should you buy Polygon’s MATIC after posting 27% in 7 days?

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  • Polygon’s token has gained 27% in 7 days

  • The network achieved carbon neutrality recently

  • MATIC, the native token, is trying to find support after hitting resistance

In this bear crypto market, finding a token with double-digit returns in a week is challenging. However, Polygon’s MATIC/USD has gained 27% in that period. The returns do not suggest that the cryptocurrency is now in bullish momentum. However, it does point out that investors, especially those trading in the short term, should take note.

Polygon is a layer-2 Ethereum scaling solution network. It aims to offer cost-effective and faster transactions on the Ethereum network using sidechains. MATIC is the native token on the Polygon network. DeFi applications find Polygon useful as it helps them avoid costly fees on the core Ethereum network. Some of the DeFi applications that support Polygon include Curve Finance and Aave.

The recent gains in MATIC/USD have largely been fueled by fundamentals. About a week ago, the network announced that it had achieved carbon neutrality. Polygon said that it partnered with KlimaDAO as part of its Green Manifesto. The news sparked a bullish move as the environmental impacts of cryptos have been in the limelight. The network invested $400,000 in carbon credits to kick off the goal. 

MATIC/USD slides after hitting a resistance

Source – TradingView

Looking at the shorter time frame, MATIC is bearish after hitting resistance at $0.62. The level coincided with overbought conditions after the latest news. However, the recent gains offer renewed hopes that MATIC’s recovery is well on course. We believe that investors are not yet done with MATIC, and price recovery could occur soon. Investors should monitor lower levels at $0.49 and $0.39 for price action buy signals. The cryptocurrency will find a lasting bullish momentum if it successfully clears $0.62.

Summary

Polygon is a Layer-2 scaling solution on Ethereum. The network achieved carbon neutrality recently, adding bullish moves for MATIC. The token is currently under retracement.

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