April was an interesting month for the cryptocurrency market, characterized by high volatility, new yearly highs, and a sharp drop. BeInCrypto shares a Bitcoin (BTC) and Polygon (MATIC) price forecast for May 2023.
The month is coming to an end and volatility has almost completely dissipated, however, May could bring excitement back to the cryptocurrency market.
Below are the biggest predictions for May, related to Bitcoin, Polygon, and the cryptocurrency market.
Bitcoin (BTC) price will reach its first bearish monthly close in 2023
Bitcoin price has created three successive bullish monthly candlestick closes. Unless the price closes below $28.476 in the last two days of April, the monthly candle will also be bullish, leading to the fourth such consecutive candle.
However, the future viewpoint for May does not look so positive. The main reason for this is the negative reaction to the $31,000 horizontal resistance area.
While the BTC price initially moved above this area, it was sharply rejected, initiating a short-term decline. The area is crucial as it has intermittently acted as support and resistance since early 2021, according to a BTC/USD – monthly chart published by TradingView.
In addition, the weekly relative strength index (RSI) looks ripe for rejection. Traders use the RSI as a momentum indicator to assess whether a market is overbought or oversold and to determine whether to accumulate or sell an asset.
If the BTC price reaches a close above the $31,000 resistance area, it will invalidate this bearish forecast and could trigger a rally to $42,000.
Bitcoin’s dominance rate (BTCD) will decline sharply.
The bitcoin dominance rate (BTCD) shows the ratio of Bitcoin’s market capitalization to the rest of the cryptocurrency market. A BTCD value of 48.50% means that 48.50% of the total cryptocurrency market capitalization comes from Bitcoin.
Although BTCD is close to a new yearly high, it shows several bearish signs. First, it created a shooting star candle on the weekly time frame.
A shooting star is a type of bearish candlestick that is characterized by a long upper wick and a bearish close. It means that the upside move could not be sustained and sellers pushed the price down below the opening of the period.
Below, the weekly RSI is overbought. The last time there was this overbought was in early 2021, preceding a very sharp drop. Then, the BTCD is likely to decline to 42%. This forecast will not be valid for a weekly close above the 48% resistance area. In that case, BTCD could move to 62%.
Polygon’s price forecast: MATIC will fall out of the Top 10
Looking at the altcoins in May, the price predictions do not favor Polygon (MATIC). MATIC is currently ranked among the top 10 cryptocurrencies based on market capitalization and has been in the top 10 for a long period of time.
However, the price action is showing several bearish signals suggesting that the next few months will not be positive for the MATIC token price. The main reason for this is the fact that the cryptocurrency is trading slightly below the support line of a long-term ascending parallel channel.
Such channels usually contain corrective patterns, which means that an eventual breakout is the most likely scenario. If one occurs, Polygon’s price could fall toward the $0.75 support area and potentially break below June 2022 low at $0.32, shown in a Polygon (MATIC) Price Long-Term MATIC/USDT – Weekly Chart issued by TradingView.
A close above the support line will invalidate this bearish forecast. In that case, MATIC’s price may move towards the mid-channel line at $1.45.
By Marina Meza
