Polygon (MATIC) took a break from its prevailing bearish course, posting considered one of sharpest rebound in the crypto market this week.
Notably, MATIC’s price has risen to $0.50 this June 23, four days after hitting $0.317, its lowest degree since April 2021. This quantities to roughly a 60% acquire, surpassing the performances of even Bitcoin (BTC) and Ether (ETH) in the identical timeframe.
MATIC/USD every day price chart. Source: TradingView
Nevertheless, MATIC remains to be down considerably from its December 2021 excessive of $2.92, coinciding with the general crypto bear market and a hawkish Fed placing stress on risk-on belongings.
MATIC “in a pretty big accumulation”
Meanwhile, a few of its richest buyers have been accumulating MATIC tokens regardless of the overall downtrend, on-chain knowledge suggests.
Notably, the so-called MATIC sharks and whales have been in accumulation, in response to knowledge supplied by Santiment. That consists of the tiers of Polygon token holders starting from 10,000 to 10 million cash, which have “collectively added 8.7% more to their bags” since May 9.
$MATIC sharks and whales have been in a fairly large accumulation development for about six weeks. The tiers of holders starting from 10k to 10m cash held have collectively added 8.7% extra to their luggage in this timespan. https://t.co/oasCn72rxt pic.twitter.com/lm4au2fWkn
— Santiment (@santimentfeed) June 22, 2022
Interestingly, MATIC’s price has fallen by 50% in the identical interval, underscoring that many whales are assured about its long-term restoration.
Inverse head and shoulders
From a technical perspective, MATIC/USD seems to be heading towards a brand new multi-week excessive.
In element, the Polygon token has been breaking out of its “inverse head and shoulders,” or IH&S sample, since June 22. IH&S is a bullish reversal setup that kinds after the price kinds three troughs in a row whereas hanging the wrong way up by a standard help line known as the “neckline.”
Also, an IH&S’s center trough (the pinnacle) is deeper than the opposite two, known as proper and left shoulders, respectively. Ultimately, the setup resolves after the price breaks above the neckline, and, as a rule of technical evaluation, rises by as a lot as the space between the pinnacle and the neckline.
MATIC/USD four-hour price chart. Source: TradingView
As a results of its IH&S sample, MATIC’s price may rally towards $0.60 in June or early July, up about 20% from at the moment.
Caution for MATIC bulls
Whale shopping for isn’t essentially a bullish sign, and the IH&S sample has a failure fee of 16.5%. So, an extra price rally may additionally immediate whales to flip MATIC for a fast revenue, given the tight circumstances elsewhere in the cryptocurrency and conventional markets that would end result in false restoration alerts.
Related: ‘Bitcoin dead’ Google searches hit new all-time excessive
Additionally, the MATIC stability throughout all of the crypto exchanges has jumped from 1.21 billion to 1.37 billion between May 1 and June 23, in response to knowledge from CryptoQuant, indicating further potential sell-pressure in the close to time period.
Polygon trade reserves. Source: CryptoQuant
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