Polygon (MATIC) sees a strong oversold rejection after $ 250B. crypto market rebound

Polygon (MATIC) proved to be one of the top performers among high-ranking cryptocurrencies on January 26, when the price rose almost 17% to reach an intraday high of $ 1,825.

The gain emerged amid a synchronous recovery across the crypto market starting on 24 January. In detail, investors and traders flocked over $ 250 billion across digital assets, benefiting Bitcoin (BTC), Ether (ETH) and many others in the process.

Performance of the top fifteen cryptocurrencies in the last 15 days. Source: TradingView

Polygon, a secondary scaling solution for the Ethereum blockchain, also cashed in on the crypto market recovery. The valuation of its original token, MATIC, rose from as low as $ 9.77 billion on January 24 to as high as $ 13.58 billion two days later.

Meanwhile, the price rose from $ 1,312 to $ 1,825 in the same period – a nearly 40% increase in just three days.

Fed meeting and high-profile hiring

The latest acquisition in the Polygon market emerged ahead of an announcement from the Federal Reserve about its interest rate hike scheduled to come in the afternoon of January 26th.

In detail, cryptocurrencies have also been through several whips in recent months over expectations that the US Federal Reserve would embark on a series of rate hikes to combat inflation. Similarly, stock markets have suffered due to the prospect of the Fed’s declining balance sheet and higher interest rates.

According to Luca Paolini, chief strategist at Pictet Asset Management, people may expect that the recent turmoil in the stock market and a growing rift between Ukraine and Russia, which have drawn the focus of NATO allies, could cause the Fed to downplay its rate hike rhetoric .

Nevertheless, Polygon managed to outcompete top rivals like Bitcoin and Ethereum in terms of intraday gains, and it seems that a high-profile hiring was the core reason behind it.

As the Cointelegraph reported on January 25, YouTube’s gaming chief Ryan Watts left the streaming giant to join Polygon Studios, a gaming and nonfungible token (NFT) backed by the $ 2 million brother-in-law’s namesake fund.

Related: Altcoins post a 40% gain after Bitcoin and the crypto market enter an emergency rally

The news apparently increased investors’ appetite for MATIC, which made it outperform other large-cap cryptocurrencies.

Key levels of support held

MATIC’s sharp recovery put the price back above its 200-day exponential moving average (200-day EMA; the blue wave in the chart below), a level that is significant for its role in limiting market downside bias.

MATIC / USD daily price chart. Source: TradingView

On January 25, MATIC bulls attempted to regain the 200-day EMA in support nearly a week after losing it. Drop-and-bounce around the blue wave was very similar to the price development in the July-August period last year, where the closure over it had led to a price increase of 200% plus.

The fractal shows a strong buying sentiment among MATIC traders near the 200-day EMA.

Therefore, if the price remains above the support, its probability of continuing its uptrend seems higher. Nevertheless, the bullish momentum risks exhaustion near MATIC’s declining trend line resistance, as shown in the chart above.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should do your own research when making a decision.