Polygon’s network growth surges – Identifying what it means for POL’s price

• POL saw strong network growth and bullish patterns, targeting a breakout above $0.5324
• Market sentiment improved as retail activity rose, with technical indicators hinting at a trend reversal

Polygon [POL] has seen a staggering 426% hike in active addresses over the past week, signaling strong growth in user engagement. At press time, the altcoin was trading at $0.4533, following a 1.91% drop over the last 24 hours. 

Despite this minor dip, however, POL’s technical and fundamental indicators seemed to align with each other, suggesting a potential breakout. Will the altcoin overcome its resistance and deliver a bullish trend reversal?

Any bullish possibilities?

POL’s price action revealed a descending wedge pattern – A classic bullish reversal setup. The double bottom formation near $0.4389 provided some additional support, reinforcing the potential for a price rebound. 

If POL breaks above the critical resistance level of $0.5324, it could trigger a significant bullish rally. However, the token must maintain sustained buying pressure to overcome the resistance and escape its downward trajectory.

Source: TradingView

Network activity indicates rising adoption

Polygon’s network activity has surged remarkably though, with active addresses climbing by 426% over the last seven days. Additionally, zero-balance addresses increased by an impressive 1,134.82% – A sign of heightened user engagement across the network. 

Although new addresses dropped slightly by 6.83%, the surge in active users highlighted a strong interest in the platform’s capabilities. Consequently, this network expansion has positioned the altcoin well for potential upward momentum.

Source: IntoTheBlock

Technical indicators show room for recovery

POL’s Relative Strength Index (RSI) stood at 43.76, indicating proximity to oversold territory. This often precedes upward price movement. 

Furthermore, the Directional Movement Index (DMI) revealed a +DI of 14.77, a -DI of 25.35, and an ADX of 22.92, pointing to weakening bearish momentum. Therefore, if the +DI crosses above the -DI, a trend reversal could take shape, strengthening the case for a bullish breakout.

Source: TradingView

Transactional stats show hike in retail activity

Polygon’s transactional stats also revealed an interesting shift in activity. Micro-transactions between $0 and $10 surged by 1,444% and 1,164.44%, respectively, highlighting growing participation from retail users. 

Meanwhile, larger transactions above $1,000 declined significantly, with $1,000–$10,000 transactions dropping by 65.38%. Consequently, the hike in smaller transactions pointed to growing utility for everyday use cases on the network.

Source: IntoTheBlock

Exchange netflow hints at potential price action

Exchange netflow highlighted an inflow of 449.6175k tokens, representing a 0.23% hike. This rise is a sign of higher liquidity, which often alludes to greater trading activity. 

Therefore, this inflow may pave the way for heightened market volatility, positioning POL for a potential breakout above its resistance levels.

Source: CryptoQuant