On December 10, Matic, a Binance IEO, flash crashed up to 70% value in a matter of hours. This created a large bearish candle that ultimately outweighed the previous price increase. However, the price has found support on the last ascending support line and has begun to show some signs of strength. In the short term, there is a possibility of further consolidation within the newly created trading range.
After Matic plummeted, other Binance IEO like Celer Network and Harmony fell into the same situation. Based on the Ichimoku Cloud, the Matic trend is currently in danger as CELR, and ONE seems to have lost the momentum for a potential uptrend.
It’s unclear why Matic flash crashed, but many believe that Matic Network may have moved 15% of its token supply to liquidate. Co-founder of Matic Network, Sandeep Nailwal, later speculated that market manipulation was the cause of this decline. Binance CEO Changpeng Zhao (CZ) said the Binance team was investigating to clarify the incident and affirmed that the MATIC team is not at fault.
Matic technical analysis
Before starting to rise rapidly, the MATIC price has been trading in an ascending channel since August. A breakout of November 25 made the price move outside the channel resistance line.
Then, when the price begins to move down, it does not react to the resistance line but returns to confirm the support line in the form of a wick. Currently, it is trading above this line.
Source: Trading View
Notably, there is a relationship with the 100-day moving average (MA).
This MA first acted as a resistance level in August and caused the price to decline. The same thing happened on September 30. After the price broke above the MA, the price rallied faster and has been trading on it ever since.
Even after a quick plunge on December 10, the price has found support on this MA where it is currently trading. Therefore, as long as the price is trading above the 100-day MA, we can assume its outlook remains bullish.
Source: Trading View
Disclaimer: This is not trading advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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