Altcoins
MATIC’s Bearish Phase Confirmed! Is $0.40 the Altcoin’s Next Target?
- MATIC struggles to find its footing after almost all of its shareholders lost profits
- The MVRV indicator revealed that the token was in a bearish phase and would need a 13% increase to break out of it.
Things went from bad to worse for Polygon [MATIC] after the last market correction. To be very precise, the token price dropped to $0.43 on July 5.
To put this into perspective, the last time MATIC reached this level was in July 2022. At the time, the cryptocurrency market was in a full-blown bear market phase.
MATIC’s recent decline is in line with that of the market as a whole. However, on one level, it appears to be an isolated phenomenon.
Normally, you would expect most of the top 20 cryptocurrency holders, or at least some of them, to make a profit at some point. But is that really the case with MATIC?
Polygon finally leaves the “green land”
Well, the bad news is that MATIC can’t boast of the same. According to In the block97% of the project’s active addresses are now out of the money. In simple terms, this means they are holding the token at a loss.
The remaining 3% are no profit, but are at a standstill, meaning no active MATIC holder has any unrealized gains.
In March, the price of Polygon’s native token hit a yearly high of $1.27, which allowed many holders to make money. Since then, however, it’s been all downhill for the altcoin.
At press time, the cryptocurrency had managed to get back on track towards $0.46. However, it had yet to face a massive sell wall at the minimum price of $0.49.
Source: IntoTheBlock
In this area, 550 addresses have purchased 20.47 million MATIC. So, if the price approaches this level, there is a good chance that investors are ready to sell.
If this is the case, the token’s value could drop again to $0.43. However, if buying pressure increasesThe bulls might try to break through this wall.
If this proves conclusive, MATIC could retest $0.51 on the charts. However, this possibility is unlikely for now.
Are bears here to stay?
Additionally, AMBCrypto assessed whether MATIC had fallen back into the bearish phase or not. To do this, we checked the difference between the Long/Short Market Value and Realized Value (MVRV).
This metric calculates the difference between the MVRV ratio of long-term holders and those who recently accumulate a token.
When the metric is positive, it means that the token is in a bullish phase. On the other hand, if the metric is negative, it implies a bearish phase.
For the project, the MVRV Long/Short difference was -13.75%, indicating that MATIC has been caught in the clutches of the bears. For it to break out of the zone, the price must increase by 13%.
Source: Santiment
Read Polygons [MATIC] Price forecast 2024-2025
If this happens, the token could attempt to retest previous highs. However, if it fails to do so, the price could fall again.
This time, the price could drop to $0.40.