Polygon (POL) Shows Bullish Signals but Needs Increased Buying Volume for Continued Uptrend

• Polygon (POL) shows potential for an uptrend as recent trading activity reveals a bull flag pattern, suggesting an impending bullish breakout.

• Despite the positive technical indicators, resistance could arise from unprofitable holders, highlighting the need for substantial buying pressure.

• “The MACD histogram bars flipping green indicates a regain of control by bulls, highlighting increasing buying momentum,” according to a recent analysis by COINOTAG.

Discover the latest insights on Polygon’s price dynamics and market potential as POL battles resistance and showcases bullish momentum.

Technical Analysis: Bull Flag Formation in Polygon’s Price Chart

Recently, Polygon’s POL has been detected forming a classic bull flag pattern on the four-hour chart, which often signifies a potential breakout. An initial surge saw prices reaching $0.655 after an impressive 11% gain within a 24-hour period, marking a reversal from recent bearish trends. However, this price is still down 7% over the last week, indicating a volatile trading environment.

Volume and Indicator Insights

The trading volume for POL remains low according to the volume histogram, yet there are signs of recovery. The Money Flow Index (MFI) has risen to 62, suggesting increased buying activity that could support a price surge. Additionally, the Moving Average Convergence Divergence (MACD) shows bullish indicators as the histogram bars turned green, signifying heightened buying activity. If the MACD line crosses above the signal line, it would be a strong confirmation of potential bullish movement.

Key Levels to Monitor

Analysts have identified critical price levels using the In/Out of the Money Around Price (IOMAP) tool from IntoTheBlock. Approximately 10,000 addresses have purchased POL within the range of $0.65 to $0.67, establishing this area as a possible support level. A drop below this support could trigger further selling.

Source: IntoTheBlock

Impact of dApp Activity on Polygon’s Price Dynamics

Recent statistics from DappRadar highlight a decline in Polygon’s decentralized application (dApp) volumes, which fell over 8% to $2.41 billion in the past week. Additionally, the count of Unique Active Wallets (UAWs) registered a 10% decrease. This drop signals a need for increased network engagement to enhance the project’s price stability and growth.

Source: DappRadar

Shifts in Market Sentiment: Long/Short Ratios

Polygon’s long/short ratio has experienced significant movements, peaking at 0.90 after a previous low of 0.79. Despite the increase, this metric still reflects bearish sentiment, with 52% of traders opting for short positions, indicating a lack of confidence in sustained price growth.

Source: Coinglass

Conclusion

In summary, while the recent indicators point to a possible bullish phase for Polygon, sustained momentum will rely heavily on increased trading volumes and active network engagement. Observers should keep a close eye on critical price levels and market sentiment as they navigate the evolving landscape of POL’s performance.