Posted:
- There was a gentle rise in MATIC’s Provide on Exchanges.
- Nonetheless, market sentiment showcased slowing demand amongst retail buyers.
The current surge in Polygon’s [MATIC] provide on cryptocurrency exchanges is probably not as a consequence of real demand for the token by the overall market. In a brand new report, pseudonymous CryptoQuant analyst Joao Wedson discovered:
“Just lately, we have now witnessed a peculiar situation through which the value of MATIC skilled a notable improve, coinciding with a major rise in reserves held by exchanges. Nonetheless, upon nearer evaluation of this example, it turns into evident that value fluctuations is probably not immediately aligned with the pursuits of the general public.”
The token’s worth skilled an 18% uptick within the final month amid the rally in its Provide on Exchanges. In the meantime, Wedson’s evaluation of the overall market sentiment revealed that:
“There appears to be no clear correlation with a proportional improve in public curiosity or natural demand.”
Relating to the cohort of MATIC holders driving the rally, the analyst referenced a “idea” that this can be as a consequence of token accumulation by crypto exchanges.
Wedson said:
“A idea gaining power is the likelihood that the current surge in Matic is carefully linked to the buildup of cash by exchanges. This implies that the upward momentum in value could have been pushed extra by inside change methods than by a considerable improve in demand from frequent buyers.”
Low demand from spot merchants
An evaluation of MATIC’s efficiency on a 24-hour chart revealed a gentle decline in accumulation for the reason that twelfth of November.
Additional, the values of its Relative Power Index (RSI) and Cash Stream Index (MFI) had been pegged under their middle traces. At press time, the RSI and MFI stood at 50.05 and 39.48, respectively.
The values of those key momentum indicators confirmed that token promoting has considerably outpaced accumulation amongst every day merchants.
Additional, MATIC’s Shifting Common Convergence/Divergence Indicator (MACD) confirmed the bearish sentiment that has permeated the market.
Supply: MATIC/USDT on TradingView
Learn Polygon’s [MATIC] Price Prediction 2023-24
There has additionally been a gentle decline in Open Curiosity within the Futures market. In keeping with knowledge from Coinglass, MATIC’s Open Curiosity has steadily decreased by 21% for the reason that sixteenth of November.
When an asset’s Open Curiosity declines, it signifies that merchants are closing out present positions. That is finished to take income or as a hedge towards potential losses.