Will MATIC Drop to $0.61 in May Despite Holding Key Level?


If the 31,000 addresses holding Polygon tokens decide not to sell, MATIC might climb towards $0.83. According to IntoTheBlock, these addresses bought 216.94 million tokens at an average price of $0.73, making this a crucial level for MATIC.

Currently, 111,724 addresses, or 17.34% of the total supply, are in profit, while a staggering 501,710 addresses, representing 77.85%, are out of the money. Depending on the direction MATIC takes next, the $0.73 level could either act as support or resistance.

Analyzing MATIC’s Potential Movement & Price Levels & Market Correlations

A break above the $0.73 mark for MATIC could propel the cryptocurrency to $0.76, where 36.69 million tokens were accumulated. This might signal the beginning of a breakout towards $0.83.

Conversely, a breakdown could lead to a drop to $0.61, a level where many holders entered profitably. As of now, MATIC’s price has decreased by 4.37% in the last 24 hours.

Source: IntoTheBlock

Should this downward momentum persist, MATIC could aim for a rise between $0.83 and $0.89.

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Besides participant actions, Ethereum (ETH) stands out as an altcoin capable of influencing MATIC’s direction. Our research indicates a strong correlation between Polygon and ETH, with a correlation coefficient of 0.93. Similarly, with Bitcoin (BTC), the correlation stands at 0.87.

Correlation coefficients range from -1 to +1. A reading near -1 indicates divergent price movements, while a value near 1 suggests that the cryptocurrencies move in tandem.

Hence, if ETH manages to avoid dropping below $3,000, MATIC might surge to $0.83. Conversely, if ETH’s price declines, MATIC could undergo another correction, possibly to $0.61.

Analyzing MATIC’s Potential Movement Using On-Chain Data

On-chain data from Santiment suggests that MATIC might enter a bearish phase if it experiences further corrections.

The MVRV Z Score, a metric indicating market sentiment, is crucial in this analysis. When this score falls below zero, it signals bearish dominance, making price increases challenging. Conversely, a positive reading suggests potential price appreciation. Currently, Polygon’s MVRV Z Score sits at 0.19.

Source: Santiment

Should this metric decline further, it could invalidate the bullish predictions mentioned earlier. Conversely, a rapid increase in the metric could prevent MATIC from entering a more challenging phase.

Traders are advised to monitor this metric closely before taking any significant positions. Additionally, a low reading on the metric might indicate that MATIC is undervalued.

If millions of addresses continue to accumulate MATIC at the $0.73 level, it could potentially prevent the token from entering a bear cycle.

Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.


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