MATIC β†’ Polygon Breaks Resistance! Should we Long or Short?

MATIC has broken above the Previous Resistance Zone and is currently re-testing it as support. Is this a scenario where we enter a long? Or are we at the top ready to short?

How do we trade this? πŸ€”
We can play either scenario, but we need confirmation in one of the directions to have enough justifications to enter a trade. If the price comes back up and successfully tests the Support Zone, then it's reasonable to long scalp to the next Resistance Zone at $1.19. If we break below and re-test the Support Zone as resistance, it's reasonable to short scalp near the Support Line. Bitcoin is also at a crucial point in the market cycle, we need to see if it falls or breaks out to and above $46,000. Bitcoins direction could (and probably will) drag the alt market with it.

We need that confirmation to have enough probability to enter a trade. We're stuck in limbo without a clear direction at this point and should remain on the sidelines until more price actions prints on the screen.

πŸ’‘ Trade Ideas πŸ’‘

Short Entry: $0.93
πŸŸ₯ Stop Loss: $1.00
βœ… Take Profit: $0.86
βš–οΈ Risk/Reward Ratio: 1:1

Long Entry: $1.065
πŸŸ₯ Stop Loss: $0.970
βœ… Take Profit: $1.160
βš–οΈ Risk/Reward Ratio: 1:1

πŸ”‘ Key Takeaways πŸ”‘

1. Broke Above Previous High, Testing for Support.
2. If Price Falls Below Support Zone and Fails Re-test, Short.
3. If Price Rises Tests Support Zone and Closes, Long.
4. RSI around 61.00 and above Moving Average, Short-term Bias to Long.
5. Keep an eye on Bitcoins Price Movement as a leading indicator.

πŸ’° Trading Tip πŸ’°
Don't trade without clarity. If the price action isn't giving you favorable probability or optimal entries, don't trade it. You will be far wealthier by waiting on the sidelines.

⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!

Like πŸ‘ and comment if you found this analysis useful!

MATIC followed the rest of the crypto market with a massive sell off and in case you missed it, the circled bar in the above chart was the signal to sell. A quick 1:1 scalp was all that was justified given the massive sell bar, but a sell bar it was! The crypto market is cooling off from the sell-off, now we need to wait for another sell signal as I believe we have more downside to come before new all-time highs are hit.

-Joe Dean
Trader Engineering Course
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