In Brief
The MATIC price has experienced a notable surge, increasing by 57% and currently trading at $1.12. This marks the highest point for the altcoin since April 2023. The concentration of short-term traders has risen, and the exchange balance has increased by 100 million MATIC. Bitcoin’s strength remains a crucial factor for Polygon’s native token, potentially keeping MATIC afloat despite selling pressures in the market.
Polygon Traders Switch to Selling
Over the past month, Polygon’s price has seen substantial gains, reaching $1.12. Despite facing resistance throughout February, investor support propelled the cryptocurrency to an 11-month high. However, recent data suggests a shift in sentiment as investors begin selling. The total supply of MATIC available on exchanges has increased by 100 million in the last 12 days, reaching a total of 1.2 billion MATIC.
An increase in exchange supply often indicates a potential intention to sell. This is particularly significant during bullish periods, signaling profit booking. The biggest concern arises from short-term traders, holding the asset for less than a month. Their concentration has doubled from 3.9% to 7.8% in two weeks, currently holding about $782 million worth of tokens. If these investors choose to sell for profits, it could pose a significant threat to Polygon’s price rise.
MATIC Price Prediction: Performance Hinges on Bitcoin’s Performance
The MATIC price is approaching a critical resistance level of $1.18, historically a solid support level and a potential gateway to surpass $1.20. Despite facing resistance from its investors, MATIC’s fortunes may align with Bitcoin’s performance. Bitcoin recently established a new yearly high of $68,359, instilling optimism for additional profits. With a high correlation of 0.9 with Bitcoin, MATIC could follow BTC’s momentum in case it diverges from traditional demand and supply dynamics.
If MATIC continues its ascent, it could turn the $1.18 resistance into support. Failure to breach this barrier might lead to a fallback to $1.05, and a daily candlestick close below this line could leave the altcoin vulnerable to a decline to $0.95, potentially invalidating the bullish thesis.
