- MATIC recovers 27%, but 90% of long-term holders are in losses, indicating possible selling pressure soon.
- Active MATIC traders are taking profits as TD Sequential warns of an impending correction that could impact short-term gains.
Polygon (MATIC) has experienced a remarkable price increase of 27.37% in the past week. MATIC was 0.5274 USD At press time, the 24-hour trading volume was $730.3 million.
This represents an increase of 11.70% in the last 24 hours. Despite this upward momentum, market analysts urge caution.
Ali, a market analyst, specified,
“Polygon has seen a significant increase over the past few days, but caution is advised. The TD Sequential on the hourly chart signals a possible correction for $MATIC.”
Traders are closely watching these technical indicators as they point to the possibility of a pullback after the recent rally.
Source: X
Long-term MATIC holders must expect losses
Accordingly IntoTheBlock Data from MATIC’s Global In/Out of the Money chart shows that the majority of long-term holders are currently facing losses.
At the time of writing, 90.44% of the addresses, or 587,240, are “out of the money,” meaning their purchase price is higher than the current value.
Only 5.34% of addresses, or 34,680 addresses, are profitable, while 4.22% of addresses are breaking even. This data suggests that most MATIC holders are incurring losses at current levels, potentially contributing to selling pressure.
Source: IntoTheBlock
Active addresses, on the other hand, show a different trend. The majority of active addresses, 79.75% or 1,020 addresses, are “in the money” and are currently holding MATIC at a profit.
This contrasts with long-term holders, as active traders have benefited from recent price increases. However, 15.58% of active addresses are out of the money, suggesting that some traders could be at risk in the event of a correction.
Source: IntoTheBlock
Upcoming migration from MATIC to POL
Meanwhile, the transition from MATIC to POL as the native gas token is scheduled to take place on September 4, 2024. POL will replace MATIC as the gas token for Polygon PoS, which will be used to conduct transactions and secure the network through validator incentives.
The migration will be automated through a smart contract that will convert MATIC to POL at a 1:1 ratio, allowing users to continue transacting seamlessly on Polygon.
After the upgrade, all transactions on the Polygon PoS network will automatically use POL. The Polygon bridge will support POL, ensuring seamless interoperability between Polygon and Ethereum.
No action is required from MATIC holders as the migration will be handled via the contract.
The Polygon network has maintained strong trading activity, with 3.27 million transactions completed in the last 24 hours. 55,169 new addresses were added to the network during this period, reflecting the increased interest in the platform.
Read Polygons (MATIC) Price Prediction 2024-25
In addition, the total value locked (TVL) in the Polygon ecosystem is $889.09 million, with inflows of $1.67 million in the last 24 hours, according to DefiLlama.
Source: DefiLlama
Despite the positive network metrics, the potential for a price correction remains a cause for concern for traders
