The entire crypto market faced a massive dump on 25 July. Consequently, some altcoins’ prices went on a downtrend. One of them is Polygon [MATIC], which had an 8.59% decline over the last 24 hours as per CoinMarketCap.
The Ethereum-based cryptocurrency had also decreased by 19.83% in the last seven days. It was one of the top twenty cryptocurrencies with the most losses. At the time of writing, MATIC was 73.90% down from its all-time high (ATH) of $2.90.
With Bitcoin [BTC] moving downward, it was expected that most altcoins would follow. However, Bitcoin fell 3.58% over the past seven. So, how did MATIC perform worse than the crypto king?
About time maybe?
Between 14 July and 18 July, MATIC had significant gains. During this period, the price moved from $0.54 to $0.92. Thus, making reasonable profits for investors. The four-hour chart also revealed that the MATIC support subsequently increased around the same time. It increased from $0.54 to $0.75.
The current happenings may not be surprising since MATIC lost its support level on 22 July- from $0.86 to $0.82. Despite recovering to $0.87, a price fall was imminent.
While the 20-period Exponential Moving Average (EMA) (blue) had remained over the 50 EMA (red) for some time, it could lose its dominance soon.
At the time of this writing, the 50 EMA was on the verge of rising above the 20 EMA. This state may make it necessary for MATIC investors to be alert. This is because a further downtrend might follow the 8% decrease.
Source: TradingView
The position of the Relative Strength Index (RSI) may also seem to agree with the EMA projections. At press time, the RSI was below the mid-level at 43.69.
Source: TradingView
With this data, MATIC sellers have an edge and are in control. For buyers, it could be a good entry point. However, investors should be cautious as there are clear signs of a further price decline.
On-chain metrics
MATIC had also decreased in 24-hour volume in line with its price decline. At press time, it stood at a 10.22% reduction. Similarly, the 24-hour active addresses on the Polygon chain have shrunk since. On 25 July, it was 3,349, but it was 2,290 at the time of this writing.
However, the supply held by whales stayed the same.
Source: Santiment
As a result of these metrics, MATIC may not reverse to an uptrend soon. However, if the selling pressure reduces, it could create a balanced state for the MATIC price.
