Following the recent upgrade of Polygon’s token from MATIC to POL, there were high expectations for a surge in its price. However, contrary to predictions, the token has been facing consistent setbacks in the past few weeks. This has prompted a detailed investigation by CryptoCrypto into the reasons behind this negative trend.
Polygon’s Uncertain Future
Since the upgrade, POL has failed to generate significant bullish sentiment, leading to a significant 25% drop in its price over the last month. In the past seven days alone, the token experienced a correction of 15%. Analysis of IntoTheBlock’s data by CryptoCrypto revealed that only a mere 21 Polygon addresses were in a profitable state, a tiny proportion compared to the total number of POL addresses.
Furthermore, recent reports by CryptoCrypto indicated that despite the significant update, Polygon observed a notable decline in network activity during Q3 of 2024. However, there remains a possibility of a potential recovery in the upcoming days or weeks.
Renowned crypto analyst Ali recently took to Twitter to highlight a bullish pattern on POL’s chart. The analyst pointed out a long-term bullish pattern that has been forming on the token’s chart since 2021, suggesting a consolidation phase. If POL successfully tests this pattern and breaks out, investors could expect a substantial rally, offering them the opportunity to reap profits. An optimistic target of $32 for POL by 2025 was also mentioned.
Anticipating Short-Term Movements
Delving into Polygon’s on-chain data, CryptoCrypto sought to predict the potential short-term movements of POL. Notably, the MVRV ratio for POL witnessed a significant decline in the past week, indicating a bearish signal. However, there has been an uptick in buying pressure on the token recently, characterized by a decrease in POL’s supply on exchanges alongside an increase in its supply off exchanges, signaling increased investor buying activity.
Historically, an increase in buying pressure has often been followed by a corresponding rise in price.
Examining the daily chart of the token, analysis by CryptoCrypto revealed a bearish trend with the MA cross-technical indicator, as the 21-day MA stood well above the 9-day MA in the market.
Nevertheless, the price of POL has touched the lower Bollinger Bands limit, a signal that typically suggests the possibility of an upward price movement in the near future. If this scenario unfolds, POL could potentially target $0.38 before embarking on a complete recovery.