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- There has been a steady increase in MATIC’s offerings at trade fairs.
- However, market sentiment showed declining demand among retail investors.
The recent rise of Polygon’s [MATIC] The supply on cryptocurrency exchanges may not be due to a real demand for the token by the general market. In a new reportfound pseudonymous CryptoQuant analyst Joao Wedson:
“Recently, we witnessed a peculiar scenario in which the price of MATIC experienced a remarkable increase, coinciding with a significant increase in reserves held by exchanges. However, upon further analysis of this situation, it becomes clear that price fluctuations may not be directly aligned with the interests of the public.”
The value of the token saw an 18% increase in the past month amid the rally in supply on the exchanges. Meanwhile, Wedson’s assessment of overall market sentiment revealed the following:
“There does not appear to be a clear link with a proportional increase in public interest or organic demand.”
Regarding the group of MATIC holders driving the rally, the analyst referred to a “theory” that this could be due to the accumulation of tokens by crypto exchanges.
Wedson stated:
“One theory gaining momentum is the possibility that Matic’s recent rise is closely linked to the accumulation of coins through exchanges. This suggests that the upward momentum in prices may have been driven more by internal currency strategies than by a substantial increase in demand from ordinary investors.”
Low demand from spot traders
A review of MATIC’s performance on a 24-hour chart revealed a steady decline in accumulation since November 12.
Furthermore, the values of the Relative Strength Index (RSI) and Money Flow Index (MFI) were below their midlines. At the time of writing, the RSI and MFI stood at 50.05 and 39.48 respectively.
The values of these key momentum indicators showed that token sales have significantly exceeded accumulation among daily traders.
Furthermore, MATIC’s Moving Average Convergence/Divergence Indicator (MACD) confirmed the bearish sentiment that has permeated the market.
Source: MATIC/USDT on TradingView
Read Polygon [MATIC] Price prediction 2023-24
There has also been a steady decline in Open Interest in the Futures market. According to data from Mint glassMATIC’s Open Interest has steadily declined by 21% since November 16.
When an asset’s Open Interest decreases, it means traders are closing existing positions. This is done to take profits or as a hedge against potential losses.
