Polygon's native token MATIC has been experiencing a steady decline over the past few weeks. While this is not surprising as many other altcoins are also facing the same downward trend due to negative market sentiment, the volatility of the MATIC price can be both profitable for traders and risky for inexperienced investors.
In the past day and over the past seven days, MATIC has dropped by 6.9% and 20.3% respectively. According to on-chain analysis platform Santiment, millions of MATIC tokens have been transferred between exchange addresses. These large whale transactions in the Polygon network could further intensify the downward trend as it suggests that holders are selling their MATIC tokens. At the time of writing this article, the price of MATIC is at $0.8675, a decline of 44.53% since February 18, 2023.
The current Crypto Fear and Greed Index (CFGI) confirms the bearish sentiment surrounding the MATIC price as it indicates a score of 38, indicating fear among investors. This suggests that MATIC is in a phase where investors and traders are afraid to hold onto the asset. If the bulls continue to stagnate, this could lead to further dumps.
Meanwhile, the 24-hour trading volume of MATIC has decreased by 15.38% to $375 million, and a decrease in daily trading volume indicates that less activity is happening in the network. However, with a market capitalization of $8 billion, MATIC still maintains its position as the 9th largest cryptocurrency on CoinMarketCap.
MATIC is currently trading under both the 50-day and 200-day SMAs, indicating a bearish trend in the short and long term. Traders can use this current trend to sell or avoid MATIC until it fully recovers. MATIC's RSI value of 22.99 also suggests that the asset is currently oversold, implying that the price of MATIC has dropped rapidly, and a correction may be imminent.
The moving average convergence/divergence (MACD) being below the signal line confirms the downtrend, suggesting that MATIC is currently in a downward trend movement. The histogram is also below zero, confirming the bearish momentum.
MATIC is trading between significant support and resistance levels at $0.7438 and $1.0306, respectively. The asset has already broken through the first primary support of $0.9335 and is likely heading strongly towards the next support level.
With this strong bearish momentum, bears could break the next support and eventually reach the last support of $0.51. However, if the bulls could regain control, MATIC may reach the strong resistance level at $1.1900.
Overall, while MATIC is facing a bearish market, experienced traders can still benefit from the volatility, while inexperienced investors should exercise caution and consider the risks involved.
