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Polygon price has been in a free fall this year and is approaching its year-to-date low.
Polygon ($POL) dropped to a low of $0.1800 on Friday, July 4, down over 76% from its highest point this year. This decline has erased more than $4 billion in value, with its market cap falling from nearly $6 billion to $1.88 billion.
Polygon could be on the verge of a breakout after the network flipped Ethereum (ETH) in terms of weekly non-fungible token sales. CryptoSlam data shows that $NFT sales on the network jumped by 52% in the last seven days to $24 million, while Ethereum $NFT sales fell by 5.7% to $23 million.
Polygon’s $NFT volume was mostly driven by Courtyard, which recorded over $18 million in sales. Other top $NFT collections on Polygon included DNS, with $4.9 million in sales, and OKX $NFT Creation.
Polygon is also gaining traction in the stablecoin sector, primarily due to Polymarket. Artemis data shows that the stablecoin supply on Polygon rose by 8.5% in the last 30 days to $2.4 billion, while the number of transactions surged by 39% to 92.6 million.
Polygon’s main challenge is competition from other growing layer-2 networks. It currently holds a total value locked of over $1.2 billion, while the newly launched Unichain has already reached $1.16 billion. Base holds over $4.9 billion in TVL, and its monthly decentralized exchange volume has soared to over $28 billion.
Polygon price technical analysis
The daily chart shows that Polygon price is gradually forming a double-bottom pattern at $0.1500, with a neckline at $0.2755, its highest level in May this year. This neckline is slightly below the 23.6% Fibonacci retracement level.
$POL has also formed a falling wedge pattern, a popular bullish reversal setup, defined by two descending and converging trendlines. These lines are nearing convergence, which may lead to a bullish breakout.
If a breakout occurs, the initial target is the neckline at $0.2755, representing a potential 53% gain from the current level. However, a drop below the double-bottom support at $0.1500 would invalidate the bullish outlook.