- Circulation decreased, indicating an additional upside for the token.
- Excessive-leverage quick positions could possibly be liquidated between $0.89 and $0.96.
After a 20% improve within the final seven days, AMBCrypto observed that Polygon [MATIC] climbed again above $1. At press time, MATIC modified arms at $1.005.
Nonetheless, the current milestone won’t be the tip for the token, as some on-chain metrics hinted at an additional upside.
Considered one of these metrics was the circulation. Circulation measures the variety of tokens engaged in transactions inside a particular interval.
However with regards to the value, the metric reveals one thing else. Generally, a rise in circulation depicts seemingly promoting strain, which may draw down the value of a cryptocurrency.
Quite the opposite, a lower in circulation may foreshadow worth stability or a major upside.
In line with AMBCrypto’s evaluation of Santiment, the seven-day circulation has been lowering because the twenty seventh of December.
Supply: Santiment
MATIC to $1.20 is an possibility
If this lower continues, then MATIC’s worth would possibly purpose at one other 20% improve. Ought to this be the case, the Polygon native token would possibly hit $1.20 throughout the subsequent few weeks.
When AMBCrypto checked out Polygon from a technical standpoint, we noticed that capital has been more and more flowing. At press time, the Cash Move Index (MFI) was 87.58.
Nonetheless, this studying implied that MATIC was overbought, because the MFI studying was above 80.00.
This situation places MATIC vulnerable to a decline. Ought to the value retrace, the subsequent targets could possibly be round $0.88 and $0.92 the place the 0.618 and 0.236 Fibonacci retracement had been positioned.
Moreover, the Relative Power Index (RSI) aligned with the MFI, because it indicated that the token was oversold.
However the 20 EMA (blue) was above the 50 EMA (yellow), suggesting a bullish thesis. In a extremely bullish state of affairs, the value of MATIC may hit $1.20.
Alternatively, if bearish forces dominate the market, the worth may drop beneath $0.90. However that appeared unlikely within the quick time period.
Supply: TradingView
Longs have a transparent path
As well as, AMBCrypto analyzed the Liquidation Heatmap. For the unfamiliar, Liquidation Heatmap reveals worth zones the place over-leveraged merchants may lose cash.
At press time, HyblockCapital’s knowledge confirmed that high-leverage positions may face liquidation between $0.89 and $0.96.
However after we appeared northward, it was a completely totally different story. Above $1.05, the Liquidation Heatmap confirmed that longs may nonetheless revenue from concentrating on greater costs.
On the similar time, it could possibly be higher to keep away from utilizing excessive leverage, particularly because the market situation may change from bullish to bearish at any level.
Supply: HyblockCapital
Is your portfolio inexperienced? Try the MATIC Revenue Calculator
Going ahead, it won’t be a good suggestion to open quick MATIC positions. Regardless of the prediction, the Polygon native token would possibly pull again earlier than it continues climbing.
Due to this fact, longs, like shorts, should be cautious about putting large bets.