For the first time since the SEC lawsuit, Polygon’s (MATIC) price broke above the critical $0.70 resistance. While the MATIC price is yet to recover fully, the Polygon network has witnessed increased user traction this week. As Polygon demand rises, will it evolve in to larger MATIC price rally?
On June 10, MATIC’s price crashed to a 2023 bottom of $0.55 after the SEC labeled MATIC a ‘security’ in a lawsuit. MATIC has since gained 31%, rebounding above $0.71 on July 5.
A flurry of sell-offs has triggered a mild retracement, but as Polygon demand rises, the bulls can regain control.
Polygon Retail User Activity is on the Rise
This week, retail user activity across the Polygon network has increased. The chart below illustrates how MATIC Daily Active Addresses (7d) have gradually increased from 1.3 million users on June 27 to 1.34 million active users at the close of July 6.
Active Addresses (7d) tracks the changes in daily user activity by summing up the number of wallet addresses that carried out transactions over a seven-day period. Typically, when user demand rises, it puts upward pressure on price.
Over the past week, this increase in Polygon user demand has positively impacted the MATIC price. The recent price correction could be overturned quickly if the Active Addresses keep increasing.
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MATIC Whale Investors Are Also Piling Bullish Pressure
Polygon demand is not rising among the retail network participants alone. On-chain data compiled by santiment reveals that the whale investors, too, have been piling on bullish pressure.
As illustrated below, the MATIC whales holding 10 million to 100 million tokens have entered accumulation mode. Since the start of July, collectively, they have added another 26 million MATIC tokens to their wallet balances.
At the current market price of $0.67, this fresh investment is worth $17.4 million. Barely a week into July, this high level of accumulation indicates that the bulls are growing confident that the SEC FUD will fade away.
MATIC Price Prediction: Rising Demand Could Push it to $0.80
Given the bullish factors highlighted above, Polygon’s (MATIC) price will likely rise toward $0.80 in the coming days. However, to be confident of the bullish reversal, the MATIC price must first scale the $0.75 resistance. At that zone, the 6,060 investors that bought 300 million MATIC at the average price of $0.71 could trigger another pullback.
If the bulls can surmount that challenge, then MATIC will likely rise toward $0.80.
Conversely, the bears could invalidate the bullish MATIC price prediction if the price unexpectedly drops below $0.62.
Although, as seen below, 6,800 investors that bought 21 million MATIC at the minimum price of $0.62 will likely prevent the drop.
Still, if that support level caves in, the bears could force a downswing toward $0.58.
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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.