Analyzing MATIC Price Trends: Bullish Indicators and Predictions Amidst Binance Controversy
Crypto News – Polygon (MATIC) experienced a weekly low of $0.70 on November 22, influenced by the regulatory controversy surrounding Binance. This article delves into on-chain analytics to identify key bullish indicators that may shape the future price movement of MATIC.
On November 14, MATIC reached a five-month peak at $0.98, but the recent upheaval in Binance’s leadership led to a correction this week. As the crypto market regains its momentum, let’s explore potential scenarios for MATIC’s price.
Ecosystem Updates and Strategic Partnerships Fuel Investor Interest
Throughout this month, the Polygon network has garnered significant attention from investors due to network improvements and strategic partnerships. Despite the Fear, Uncertainty, and Doubt (FUD) that gripped the crypto market during Binance’s leadership shuffle, demand for MATIC has remained resilient.
On November 22, the daily creation of new MATIC wallets reached 1,175 addresses, coming very close to the four-month high of 1,217 new addresses recorded on November 16, according to Glassnode’s on-chain data.
The metric for new addresses measures the influx of new users to a blockchain network. By aggregating the daily number of new MATIC wallets, it gauges the increase or decrease in demand for products and services hosted on the Polygon network. An increase in new wallets logically suggests that users are not only creating new accounts but also potentially injecting fresh capital into the ecosystem.
The chart provided vividly illustrates that recent partnership announcements and network updates related to the POL token migration have generated widespread investor interest. As these new wallets begin to engage in transactions, they could exert upward pressure on the MATIC price.
Demand for MATIC Surpasses Selling Pressure Amid Market Uncertainty
Further corroborating the bullish sentiment surrounding Polygon’s recent network growth, on-chain data indicates a rapid increase in buying momentum relative to selling pressure.
Despite a 36% retracement from its peak of $0.98 the previous week, the market demand for MATIC remains robust. The Glassnode chart below confirms that the number of MATIC buyers (receiving addresses) continues to outnumber sellers (sending addresses).
This week’s data reveals that MATIC receiving addresses (buyers) increased from 1,595 wallets to 2,156 wallets between November 20 and November 22. Meanwhile, sending addresses (sellers) only saw a slight drop from 1,335 to 1,273 wallets.
This indicates a positive divergence between the number of sellers and buyers on the Polygon network, which has the potential to evolve into a bullish trend.
In essence, the receiving addresses metric estimates the number of unique wallets acquiring the MATIC token, while the sending addresses metric represents existing holders actively transferring or selling their holdings.
A bullish divergence occurs when the number of wallets purchasing MATIC (receiving addresses) increases while the number of sellers (sending addresses) declines. This phenomenon seems to have played a pivotal role in MATIC’s 7% price rebound from its weekly low of $0.73 on November 21, bringing it to $0.78 at the time of writing on November 23.
If this unique alignment persists, MATIC’s price bulls could regain control and potentially drive a retest of $0.90 in the days ahead.
MATIC Price Prediction: Path to Reclaiming $1
From an on-chain perspective, the increasing network demand stands as a significant factor fueling buying momentum in MATIC markets this week. With these critical metrics still exhibiting bullish trends, MATIC’s price appears well-positioned for another upward movement.
Global In/Out of the Money (GIOM) data, categorizing current MATIC holders based on their entry prices, also supports this short-term bullish outlook.
However, it’s important to note that bulls must overcome the initial resistance at $0.80 for a $1 retest to be a credible possibility. As illustrated below, 50,007 addresses acquired 4.14 billion MATIC at an average price of $0.81. If these holders choose to sell early, it could potentially disrupt the MATIC price rally.
Nonetheless, if the bulls successfully breach this resistance sell-wall, the MATIC price rally could potentially set its sights on $1, as anticipated.
Nevertheless, bearish forces could negate this bullish price forecast if the MATIC price drops below $0.65. However, as observed earlier this week, the support buy-wall at $0.68 could present a formidable barrier. At this level, 46,310 MATIC addresses purchased 598.5 million MATIC at an average price of $0.68, creating a robust support zone. If these investors opt to HODL and maintain their positions, Polygon is likely to avoid a significant price reversal.
In conclusion, MATIC’s price trajectory appears poised for potential upward movement, driven by positive on-chain indicators and growing investor interest, despite recent market uncertainties stemming from Binance’s regulatory challenges. However, the cryptocurrency market remains inherently volatile, and traders should exercise caution and conduct thorough research before making investment decisions.
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