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Polygon’s (MATIC) price is facing potential bearishness from its own investors, who are losing their confidence in a recovery.
If this pessimism dominates the MATIC holders’ behavior, the price action could continue failing a breakout.
Polygon Whales Offload
MATIC price, trading under $0.70 at the moment, is losing the conviction of its investors. This is evident in the whales’ dumping of their assets over the past few days. In the span of just a week, addresses holding between 1 million and 10 million MATIC have sold off over 21 million MATIC.
This $14.7 million worth of selling is a testament to large wallet addresses offsetting their losses. The lack of recovery has convinced the whales to step back and book as much profit as possible.
Since Polygon whales dominate a considerable portion of the supply, their actions impact the price. Accumulation induces recovery and rally while selling leads to a drop in prices. MATIC price will likely witness the same outcome, as the whales’ supply has dropped to a three-month low.
However, not just the whales but also retail investors are stepping back. Visible in the sharp decline in the transaction volume, MATIC holders are holding back until they see an incentive to participate. Over the past weeks, the average transaction volume has declined from $77 million to $21 million.
Read More: How To Buy Polygon (MATIC) and Everything You Need To Know
The declining activity on the network could act as a bearish trigger for the price action since reduced volatility leads to a drop in liquidity.
MATIC Price Prediction: Stuck Between Two Worlds
MATIC price for the past month has been consolidated between $0.65 and $0.75. These ranges have been tested in the past as support and resistance, respectively, and continue to stay that way.
Despite multiple attempts, the altcoin has failed to break out of this consolidation. Based on the aforementioned conditions, the altcoin could drop to $0.65; if the bearishness extends, this support could be broken, and the MATIC price could fall to $0.60 next.
Read More: Polygon (MATIC) Price Prediction 2024/2025/2030
On the other hand, if Polygon investors change their outlook and resume activity on the network, the altcoin could bounce back. MATIC price breaching the resistance at $0.75 would invalidate the bearish thesis, pushing the altcoin to $0.80.