MATIC Struggles to Recover as 97% of Holders Face Losses Amid Bear Market

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Polygon’s MATIC token struggles to regain its footing as most of its holders experience losses.
The MVRV indicator indicates that the token is firmly in a bear phase, needing a 13% hike to break free.
Following a significant market correction, the value of MATIC dropped to $0.43, a level not seen since July 2022.

Explore the latest struggles of Polygon’s MATIC token and the bear phase implications, as the crypto market faces a turbulent period.

Polygon’s MATIC Faces Major Headwinds

The latest market correction has severely impacted Polygon’s MATIC, driving its price down to $0.43 as of July 5th. This plunge brings the token back to levels last seen during the market’s bearish phase in July 2022. Unlike the broader market, MATIC’s decline appears more isolated, highlighting unique challenges for the token.

Investors in the Red

According to IntoTheBlock, a staggering 97% of MATIC’s active addresses are currently holding the token at a loss. With only 3% of addresses breaking even, it’s clear that the token’s recent performance has left most investors in the red. Back in March, MATIC managed to hit an annual high of $1.27, offering much-needed optimism. However, the token has since faced a relentless downward trend.

Resistance and Potential Recovery Path

At present, MATIC has climbed marginally to $0.46 but faces substantial resistance at the $0.49 level. Data shows that 550 addresses acquired 20.47 million MATIC in this price zone, creating a significant sell-wall. If the token’s price approaches this barrier, there’s a high likelihood that investors will capitalize on the opportunity to sell, potentially driving the price back down to $0.43. Conversely, if buying pressure intensifies, MATIC could challenge this wall and possibly retest $0.51, although current market sentiment makes this scenario seem less probable.

Bear Phase Analysis via MVRV

An analysis by COINOTAG using the Market Value to Realized Value (MVRV) Long/Short Difference metric further confirms MATIC’s bearish status. With an MVRV Long/Short Difference of -13.75%, it’s evident that MATIC is entrenched in a bear market phase. For it to exit this phase, the token’s price needs to increase by 13%. Should this occur, there’s potential for MATIC to attempt to reclaim previous highs. Failure to achieve this 13% hike, however, could see the token falling even lower, potentially dropping to as low as $0.40.

Conclusion

In summary, Polygon’s MATIC token finds itself in a difficult position, with the majority of its holders experiencing substantial losses and technical indicators pointing towards a continuing bear phase. For MATIC to reverse its current trajectory, a significant price increase is necessary. However, prevailing market conditions suggest that a substantial recovery may not be imminent. Investors should closely monitor market dynamics, particularly key resistance levels and overall buying pressure, to make informed decisions moving forward.