Polygon (MATIC) Price Dips to Unprecedented 2-Year Low
The value of MATIC, the digital token that empowers the prominent Layer 2 (L2) platform Polygon, has experienced a significant drop ever since it reached its highest point of the year at $1.22 on March 14.
Following a period of consolidation from April 14 to June 7, the token broke below the lower support level of the horizontal channel, resulting in a 33% decrease.
Polygon Currently Trades at an All-Time Low in 24 Months
As of now, the L2 token trades at $0.44. The last recorded instance when the altcoin was traded at this price level was back in July 2022.
A deep study of MATIC’s price performance suggests a significant decrease in demand for the altcoin among market participants. This inference is partly derived from the token’s Price-Daily Active Address (DAA) Divergence metric.
This particular metric compares an asset’s price movements with the changes in its daily active addresses count. It helps analyze whether an asset’s price movement is supported by corresponding activity on its network.
At present, MATIC’s Price-DAA Divergence stands at a negative value of -35.59%. Just to put things into perspective, the last time this metric surpassed zero was on October 24, 2023.
Read More: How To Purchase Polygon (MATIC) and Get Comprehensive Information
When this metric displays a value below zero, it indicates a decline in the number of daily active addresses trading that asset. With a -35.59% value, it marks a considerable decrease in the count of active addresses, which is considered bearish for any asset.
Considering both the drop in MATIC’s price and its negative Price DAA Divergence, it can be inferred that both the token’s price and network activity on Polygon are experiencing a decline.
Furthermore, MATIC’s Relative Strength Index (RSI) stands at 21.17, which further supports the aforementioned stance. This indicator measures the overbought and oversold market conditions of an asset and ranges from 0 to 100. Values above 70 indicate that the asset is overbought and in need of a correction, while values below 30 suggest that the asset is oversold and might be ready for a rebound.
Although MATIC’s RSI indicates the possibility of a price rise, the strong bearish sentiment surrounding it might hinder any such upward movement.
MATIC Price Prediction: The Continuation of the Downtrend to Multi-Year Lows
As the bearish sentiment towards MATIC intensifies, there is a chance for its price to further decline. As per the Elder-Ray Index, the value of the indicator has remained negative since the drop began on June 7.
This indicator gauges the balance between buyers and sellers in the market. A negative value suggests that the bearish pressure dominates the market.
At the time of writing, MATIC’s Elder-Ray Index stands at -0.15.
Read More: Polygon (MATIC) Price Forecast 2024/2025/2030
If the bears maintain control, they can push the token’s price further down and it may reach as low as $0.42.
However, if traders capitalize on the dip and buying pressure escalates, there is a possibility of MATIC’s price rallying towards $0.49.