A popular crypto analyst is setting the bar even higher for multi-chained scaling solution Polygon (MATIC) while the number-one crypto Bitcoin (BTC) limps along.
In a new strategy session, Benjamin Cowen tells his 666,000 YouTube subscribers that Polygon’s daily levels dating back to July show a clear uptrend, and that price discovery mode might be right around the corner even as the leading Ethereum-scaling solution reaches new all-time highs.
“You can argue that we’re in this general uptrend, and we’re closing in on price discovery mode…
[It] is always interesting because you don’t necessarily have all the same types of walls at all these different price points.”
The analyst goes on to explain how investors behave differently when the crypto assets they own are up or down.
“You could imagine that for people who bought Bitcoin at say $60k or $65k or $69k if that’s where their cost basis is for the entire stack, some of them might just want to get out.
They just set their sells there and if one day it goes to those prices, they’re happy to get out. They don’t care about making any more profits on it, they’d rather just cut their losses and move on at a potentially lower price or break even.
Whereas once you get into price discovery mode, and everyone who’s bought that token for the entire history is in profit, as long as… If you’re buying at spot, you’re watching it go up, everyone’s in profit.
So you don’t see exactly the same kind of walls. Now eventually people do take profits and you have the new bag holders who have to wait.”
Cowen next lays out the exact level he believes MATIC needs to reach in order to enter price discovery mode.
“Let’s call it $2.79. $2.79 MATIC will get it to price discovery mode. And not anything below it. I saw some people say that we’re in price discovery mode here [$2.53]… but you have to remember that back in May before we had that major crash, MATIC actually went up a bit higher…
It’s interesting to see it approaching the new all-time highs, but I think what’s more interesting is the fact that it’s been doing this while Bitcoin has been in a downtrend. That’s exceptional to me.”
The chart guru concludes his thoughts by highlighting the important contrast between recent Bitcoin highs and Polygon lows.
“MATIC has been on an uptrend despite everything that Bitcoin has gone through over the last five weeks.
MATIC is continuing to push higher and higher and higher. And rather than put in lower highs like Bitcoin has been doing, it’s instead putting in higher lows.
For instance, if Bitcoin were to get a shakeout back to $47k or something, it’s not like it’d be that crazy for MATIC to drop back down to the trend line. Maybe you go all the way back to $2 potentially.
I’m not saying it’s going to two bucks, but… we were at $1.80 a week ago. So let’s not pretend it can’t happen. If you actually look at the daily closes you can see it looks a lot nicer.”
At time of writing, 14th-ranked MATIC is up 5.71% on the day to $2.57. The altcoin would need to rally by an additional 8.56% to reach the $2.79 level Cowen is targeting.
Leading crypto BTC remains flat on the day at $48,435.
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