Polygon (MATIC) Investors Prepare to Offload 90 Million Tokens: Price Impact

3 months ago 39

Investors in Polygon (MATIC) may have been forced to take matters into their own hands. From the observation on-chain, this potential action can be linked to MATIC’s underwhelming performance.

At press time, one MATIC is worth $0.49, representing an 11.61% decrease over the last 30 days. Will the token survive another onslaught?

Polygon Institutional Favorite Status Fades

Data from blockchain analytics platforms shows that it could be challenging for MATIC to bounce. This is because the number of tokens ready to be offloaded is much higher than those waiting to snipe the token at lower prices.

Employing the Exchange On-Chain Market Depth, an indicator that tracks the order books of the top 20 exchanges, BeInCrypto noticed that traders are prepared to sell 90.32 million tokens once MATIC hits $0.50. This is evident from the ask (sell) segment of the order book.

Conversely, the total bids (buy orders) set for $0.49 are a little over 55 million tokens. The difference between the buy and sell orders shows that more traders are willing to remove the Polygon native token from their portfolio.

If this position remains the same over the next couple of days, MATIC’s price may experience another significant plunge.

Furthermore, the large holders’ netflow has decreased by 220% in the last seven days. Large Holders’ netflow measures whales and institutional interest in a cryptocurrency. An increase implies rising accumulation, while a decrease suggests distribution.

At one point, MATIC was once an institutional favorite. But this recent decline implies that the ecosytem has changed, and investors are skeptical of HODLing MATIC.

Should MATIC continue to face massive institutional distribution, its price may encounter another round of capitulation.

MATIC Price Prediction: More Losses on the Radar

According to the daily chart, MATIC has yet to break above the descending trendline since June 6. The inability to move past the region suggests that the token remains in bearish territory. If MATIC fails to rise above this trendline, then the price may struggle to recover.

In addition, the Moving Average Convergence Divergence (MACD) is negative. The MACD uses the difference in moving averages to measure momentum. When the reading is positive, momentum is bullish

When it is negative, momentum is bearish. If this trend continues, MATIC’s price may continue to fall. The On Balance Volume (OBV), which measures buying and selling pressure, gave similar indications.

At press time, the OBV trends downward, indicating that sellers have been liquidating MATIC in large numbers. If this continues, the MATIC price may head toward $0.42. However, a resurgence in buying volume could halt the downtrend and possibly lead to the price reaching $0.54.

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