Polygon’s price is on the rise as the SEC drops its lawsuit against Ripple’s top executives. This news has triggered a breakout in a double-bottom pattern, and the bulls are making a strong comeback.
Polygon (MATIC) is performing exceptionally well in the market, with a 5% increase in the last 24 hours. This boost comes after the US Securities and Exchange Commission (SEC) decided to drop charges against Ripple’s top executives.
This news is significant for MATIC, which is an Ethereum layer 2 scaling protocol. In June, the SEC categorized it as a security token, along with other tokens like Solana (SOL) and Cardano (ADA).
Polygon Price Grows 5% to Reach $0.547
Ripple’s executives see the SEC’s decision as a sign of surrender after a lengthy legal battle that began in December 2020. In early July, the court ruled that XRP was not entirely a security, as long as the sales were conducted programmatically through third-party platforms like exchanges.
However, XRP sales directly to institutional investors, like hedge funds, were considered security tokens. The SEC plans to discuss “Section 5 violations” with Ripple in relation to these institutional sales of XRP.
A victory for XRP and Ripple could set a precedent for over 60 tokens facing SEC scrutiny, including MATIC. This might explain the brief rally to $0.547, even though the token has since dropped to $0.533 on Saturday.
If bullish sentiment continues, as indicated by the Moving Average Convergence Divergence (MACD) indicator, the path of least resistance seems to be upward for MATIC.
MATIC/USD four-hour chart: Source – TradingView
Polygon’s price is currently testing the support level at the double-bottom pattern’s neckline, which, following an initial breakout, had set a target of $0.568, indicating a 6.4% increase.
Traders should consider the possibility of declines outweighing the bullish outlook, especially as MATIC’s price is trading below the 200 Exponential Moving Average (EMA) on the four-hour chart.
With Polygon’s price showing weakness below the 200 EMA, profit-taking is likely to take the lead, potentially triggering a sell-off if the support at the neckline, which is at $0.534, is breached. The first support level to watch for would be at the 100 EMA at $0.527, followed by a second support at $0.52.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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