Crypto Gains Post US Employment, Polygon MATIC Price Forecast

The broader cryptocurrency market was mostly higher last Friday and over the weekend in the wake of the release of the US Employment report, and also for the week. Polygon MATIC/USD also rallied, which sets up a more bullish price forecast for January (and possibly beyond).

Cryptocurrencies Rally with Risk Assets Post-US Employment Report

The wider cryptocurrency market rallied last Friday and over the weekend, in reaction to the release of the US Employment data, which broadly saw riskier assets climb higher on Friday.

On Thursday, the ADP private sector jobs data showed an increase for December of 235k, meaningly above expectations, and this was reinforced by Friday’s official Non-Farm Payroll data that showed an increase of 223k in December, again above consensus.

However, unemployment fell back to its September 2022, post-pandemic low at 3.5%, whilst average hourly earnings were up 0.3% for December, below consensus.

Markets interpreted this data as signalling a still solid US labour market and economy, pointing to a possible soft landing into 2023, as inflation is gradually being brought under control by the increase in interest rates from the Fed.

Polygon MATIC/USD Upside Risks (and Downside Trigger Levels)

The Polygon MATIC token sold off versus the USD to start 2023, from mid/ latter December swing peaks at 0.8193/8263 down below November lows posted in the wake of the collapse of FTX, at 0.7633/10, down to 0.7472.

Upside Challenges: Subsequent gains since then were reinforced by a rally after the US Employment report on Friday to push MATIC/USD through the December resistances clustered at 0.8193/8263 over the weekend. The push above this area has established a short-term base into mid-January, opening upside risks towards next key resistance at 0.9500. A move through here would establish a better, intermediate-term base and a more bullish recovery, to then target 1.1574 and 1.3042 into the first quarter.

Downside risks: A push below 0.7472, however, would neutralise the near-term bottoming effort, and signal a more bearish theme resuming. Downside risks would then be for a bearish extension towards targets at 0.7159 and 0.6901. Below here would set an even more bearish outlook, to aim towards 0.5193 and 0.4173 (possibly even back to the bear cycle low at 0.3162).

Polygon (MATIC) Explainer

Polygon is both a cryptocurrency and a technology platform that allows blockchain networks to scale and connect. Polygon is a stack of protocols that look to fix Ethereum’s issues of scalability, with the platform connecting Ethereum-based projects using the Ethereum blockchain.  The Polygon token is MATIC and is compatible with other digital currencies that have Ethereum as their base. MATIC is used to secure and govern the Polygon network, plus to pay network transaction fees.