**Can Polygon (MATIC) Overcome the $0.5 Threshold Amidst Bearish Trends?**
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NAIROBI (CoinChapter.com)— Polygon (MATIC) has recently dipped beneath the critical support level of $0.5, which has now transformed into a significant resistance barrier. Currently priced at $0.41, MATIC is at risk of further declines as the prevailing market sentiment remains negative.
*MATIC Liquidation chart. Source: Coinglass*
Data from Coinglass indicates a significant rise in MATIC liquidations on August 6, 2024, with short positions totaling $371.67K, while long positions only reached $89.07K. This disparity points to a bearish outlook, as traders brace for additional price drops in MATIC.
*MATIC Exchange outflow chart. Source: CryptoQuant*
Moreover, net flow statistics reveal that outflows have exceeded inflows, with over 13 million tokens being sold off by traders in response to declining prices.
*MATIC/USD 1-day price chart. Source: CoinMarketCap*
At present, Polygon (MATIC) is trading around $0.4013, representing a 12.34% rebound since August 5. This recovery follows a significant crash on August 5 that affected the broader cryptocurrency market, mainly driven by fluctuations in the yen carry trade.
*MATIC whale transactions count. Source: Santiment*
Interestingly, MATIC is demonstrating a bullish trend with an uptick in whale transactions, signifying growing interest from major investors. The MVRV Long/Short Difference stands at -27.48%, indicating that many holders are currently at a loss, which may restrain immediate selling activity. MATIC’s price has climbed to $0.812, and this upward trend, coupled with increased whale engagement, suggests a potentially favorable outlook for the asset.
**Can Polygon (MATIC) Break Free from Its Bearish Constraints?**
As of August 6, 2024, Polygon (MATIC) is trading at $0.3989, reflecting a daily increase of 3.77%. However, the price continues to feel pressure from a descending trendline, hinting at ongoing bearish sentiment.
*MATIC/USD 1-day price chart. Source: TradingView*
Fibonacci retracement levels indicate crucial resistance points. The price encounters obstacles at $0.4814 (61.8% Fibonacci retracement) and $0.5206 (78.6% Fibonacci retracement). A successful break above these levels could lead MATIC to test the psychological threshold of $0.70.
The Relative Strength Index (RSI) currently sits at 37.28, suggesting that MATIC is approaching oversold conditions. This could signal a potential reversal if buying pressure increases. Conversely, the Moving Average Convergence Divergence (MACD) indicator displays a bearish crossover, with the MACD line positioned below the signal line.
Support is identified at $0.327, a vital level for sustaining upward movement. A drop below this could initiate further declines, potentially targeting the $0.20 mark. Resistance remains robust at the trendline and within the $0.48 to $0.52 range.
**Polygon’s TVL Soars to $709 Million with 4.1 Billion Transactions**
In July 2024, Polygon (MATIC) was recognized as the fourth-largest Ethereum scaling solution by total value locked (TVL), amounting to $709 million. It trails behind Arbitrum, Base, and Blast, while surpassing Optimism. Its proof-of-stake (PoS) chain processed over 4.1 billion transactions in the second quarter of 2024.
Polygon’s average transaction fee stood at $0.01, reflecting a 41% reduction from the previous quarter, in contrast to Optimism’s Bedrock average fee of $0.06.
*Polygon PoS has processed over 4.1 billion total transactions. Source: Today In Polygon*
Despite the recent price struggles, activity on the Polygon network is on the rise. The number of daily active addresses on its PoS chain surged by 47% quarter-over-quarter, reaching 1.2 million. The network facilitated 452 million DeFi transactions over the past year, valued at $1.5 billion, outpacing Arbitrum, Base, and Optimism.
*Polygon Total Value Locked. Source: Messari report*
Moreover, the TVL on Polygon’s Polymarket platform experienced a remarkable 237% growth quarter-over-quarter, fueled by heightened betting activity in anticipation of the U.S. Presidential elections, highlighting its significance in the decentralized finance sector.