Polygon (MATIC) Price Analysis & Upcoming Migration

Polygon Labs has announced that it will replace MATIC, the native token of its Layer 2 network Polygon, with a new token, POL, on September 4. As the migration date approaches, MATIC is experiencing a downward trend, with its price showing signs of further decline.

Key Takeaways:

• Upcoming Token Swap: Polygon will replace MATIC with POL on September 4, contributing to the current downtrend.
• Decreased Large Holder Activity: Large holder netflow has dropped by 271% in the past month, indicating increased selling pressure.
• Potential Price Decline: MATIC could fall to $0.42 if the bearish trend continues, with a possible rebound to $0.63 if demand increases.

Read More: How to Buy Polygon: Learn all about Buy MATIC

Polygon’s Current Market Performance

MATIC is trading at $0.52, reflecting a nearly 10% drop in value over the last month. Major investors have been reducing their holdings, as evidenced by a 271% decline in large holder netflow according to IntoTheBlock. This metric measures the difference between the amount of MATIC bought and sold by large addresses, with a declining netflow signaling increased selling pressure.

Currently, 93% of MATIC holders, or 604,000 addresses, are at a loss, meaning the market price is below their average purchase price. In contrast, only 5% of holders, about 33,000 addresses, are in profit.

Price Prediction and Market Outlook

Source: TradingView

The Directional Movement Index (DMI) setup for MATIC confirms a bearish bias, with the negative directional indicator (-DI) above the positive directional indicator (+DI). This indicates that the negative momentum outweighs the positive, suggesting further price declines.

If the bearish trend continues, MATIC could drop to $0.42, a level last seen in July 2022. However, if there is a shift in market sentiment and demand for MATIC increases, the price could potentially rise to $0.63.

Read More: Polygon dApp Volume Hits $100M: Impact on MATIC Price?

Conclusion

With the upcoming migration to the POL token and current bearish indicators, MATIC’s price is likely to face further declines. The drop in large holder activity and widespread unrealized losses among investors contribute to the negative outlook. A rebound is possible if market conditions change, but for now, the focus remains on managing the current downtrend.

FAQs

Why is Polygon (MATIC) price declining?

The price is declining due to an upcoming migration to the POL token, reduced large holder activity, and widespread unrealized losses among investors.

What is the significance of the token swap to POL?

The token swap to POL, scheduled for September 4, is contributing to the current downtrend in MATIC’s price as investors adjust their holdings.

What are the potential future price levels for MATIC?

MATIC could drop to $0.42 if the bearish trend continues, but if market conditions improve, the price might rise to $0.63.