After the significant decline, Polygon’s potential path forward appears to be focused on growth, which may influence the actions of MATIC holders.
Polygon investors are more inclined to buy rather than sell
The correction in MATIC’s value has resulted in losses for investors to such an extent that they are opting not to sell their assets due to an inability to recover those losses. As a result, the token now presents an attractive opportunity for accumulation.
This sentiment is reflected in the Market to Realized Value Ratio (MVRV) of the coin. The MVRV ratio tracks investors’ profits and losses. Currently, Polygon’s 30-day MVRV stands at -19%, indicating losses that could potentially lead to accumulation. Historically, MATIC has shown a tendency to recover within a range of -8% to -18%, which is commonly referred to as the “opportunity zone.”
MVRV coefficient. Source: Santiment
Another factor that bolsters bullish sentiment is the nearing expiration of profits for approximately 1 billion Polygon tokens. A total supply of 969 million MATIC, worth over $658 million, was purchased at prices ranging between $0.67 and $0.73.
At the time of writing, the MATIC price has dipped below $0.67, entering the unprofitable zone. A slight surge in bullish activity would bring this supply volume back into the profit zone.
MATIC and GIOM data. Source: IntoTheBlock MATIC Forecast: Keep an Eye on These Two Resistance Levels
However, surpassing the $0.67 mark will not be sufficient. In order to make the previously mentioned tokens profitable, breaking through the resistance levels at $0.70 and $0.74 and establishing them as support is necessary. This would pave the way for further growth of the native Polygon token, aiming for $0.80 and beyond.
1-day MATIC/USDT chart. Source: TradingView
Conversely, if MATIC breaches the $0.65 support level, it would invalidate the bullish scenario and potentially trigger further declines towards $0.60.
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