- Cardano and Polygon have dropped by more than 4% over the past 36 hours.
- Further selling pressure would increase the risk for the two assets to drop another 50%.
- ADA must reclaim $ 0.97 as support, and MATIC surge to $ 0.87 to invalidate the pessimistic outlook.
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The bloodbath in the cryptocurrency market may have no end in sight, and Cardano and Polygon are showing signs of weakness.
Cardano and Polygon On the Edge:
Cardano’s ADA and Polygon’s MATIC appear to have entered a new downtrend as market conditions deteriorate.
Cardano suffered a brutal correction in the past 36 hours. It saw its price drop by more than 40%, going from a high of $ 0.66 to a recent low of $ 0.38. Even though ADA rebounded to reclaim $ 0.47 as support, it has room to drop further.
From a technical perspective, the recent downswing allowed Cardano to break out of a descending parallel channel that has developed on its daily chart since September 2021. The breach of the pattern’s lower boundary suggests that ADA has entered a steep 50% downtrend toward $ 0.28 or even $ 0.21.
A sustained daily close below $ 0.47 can serve as confirmation of the pessimistic outlook.
If Cardano can defend the $ 0.47 support level, a brief upswing to retest the channel’s lower boundary at $ 0.55 can be expected. But for the mid-term bearish thesis to be invalidated, ADA would have to print a daily close above $ 0.97.
Polygon’s MATIC is another altcoin that appears to have entered a new downtrend. The Layer 2 token recently broke out of an Adam & Even double top that developed on its three-day chart since May 2021.
The 49% correction that MATIC has seen over the past 36 hours allowed it to slice through the pattern’s valley floor at $ 0.62. Further selling pressure around the current price levels can result in a 78% retracement toward $ 0.13 or even $ 0.08.
MATIC would have to reclaim $ 0.87 to have a chance of invalidating the bearish outlook.
The cryptocurrency market continues to: bleed: after Layer 1 blockchain Terra entered meltdown mode this week due. UST: lost: its peg against the dollar, and it is currently worth just $ 0.46, while the network’s other token, LUNA, is trading at around $ 0.006. The world’s biggest stablecoin, Tether (USDT), also: lost: its peg early Thursday amid extreme market conditions, dropping to $ 0.95 and then recovering to $ 0.99.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
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