Polygon Whales Buy Despite 88% MATIC Price Crash, Why?

Polygon, a layer 2 crypto, has recently experienced a downturn in its market value, mirroring broader declines across crypto markets. MATIC price reached its peak at an all-time high of $2.92 on Dec 27, 2021, before undergoing a significant correction. Over the past week, the altcoin has seen a 5% drop, attributed to overall market volatility.

Polygon Whales Increase Holdings Amidst MATIC Price Drop

Despite a downturn in Polygon price, Santiment data shows that cryptocurrency whales are seizing the opportunity to stock up on the asset. This trend could indicate their confidence in a potential future recovery or valuation increase. 

Analysis of transactions reveals heightened activity during price dips, suggesting strategic accumulation rather than panic selling among major holders.

Recent trends have shown a notable correlation between network growth and token prices, exemplified by MATIC. Observations indicate a significant decline in network activity, mirrored by a concurrent dip in MATIC’s market price. These movements suggest that user engagement and network transactions heavily influence token valuation. 

According to IntoTheBlock data, a majority of MATIC holders are facing losses. Currently, 98.44% of all addresses are out of the money. This means these investors bought their tokens at prices higher than the current price. Conversely, only 1.05% of investors are in the money. They purchased MATIC at prices lower than today’s rate, showing a profit potential. This data underlines the high volatility and speculative nature of cryptocurrency markets.

MATIC Price Forecast: Potential Dip to Support Levels

Over the past 24-hours, the cryptocurrency market has witnessed considerable volatility. As of reporting time, the MATIC price hovered at $0.4057 during European trading hours, slightly dipping 0.22% from the previous day. The daily trading session saw a high of $0.4074 and a low of $0.393, indicating fluctuation in the market.

Polygon is experiencing a downward trend; if this momentum persists, MATIC’s value may drop to a support level of $0.38. If selling pressures intensify, the price could decrease further to $0.35. 

The 4-hour technical indicators for MATIC price show a subtle market movement. The Moving Average Convergence Divergence (MACD) indicator presents a mixed signal. Although the MACD line is positioned above the signal line, both lines are close to the zero axis, suggesting a lack of strong momentum in either direction. The Relative Strength Index (RSI) is currently at 44, indicating a neutral trend.

On the upside, a breakthrough above the $0.42 resistance could indicate a potential bullish reversal. Such a move might elevate MATIC toward a critical resistance at $0.45. The layer 2 token could soar past $0.55 with sustained positive momentum.

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Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.