The cryptocurrency Polygon is seeing a recovery as its token value increased by around 26% in the past week. Despite this positive movement, only 15.11% of holders are in profit, showing that most long-term investors are still at a loss. At the time of writing, the cryptocurrency is trading at about $0.56 with a market cap of $4.5 billion.
Many investors may not exit at a loss after a previous bull run, suggesting potential for a breakout. A crypto analyst believes that 81.6% of Polygon holders are “out of money,” reflecting high skepticism. Historically, such conditions lead to a “disbelief rally,” where assets rebound sharply when sentiment changes, possibly helping the cryptocurrency cross the $1 mark.
On-chain data reveals a similar situation with increased active addresses, transaction volume, and whale activity. Whales have recently purchased over 140 million POL tokens, showing growing confidence in its long-term prospects. Generally, a surge in whale accumulation signals a bottoming phase, as they often buy during market dips, anticipating future gains.
The absence of major selling pressure and whales buying indicates good technicals. The cryptocurrency is consolidating in a multi-year descending triangle pattern, and a weekly close above $0.7973 could trigger a rally reaching $15.27 or $36.17. However, support levels are crucial, with the $0.37-$0.39 zone being a key demand area.
If the cryptocurrency falls below this level, it could invalidate the bullish outlook and make the same demand area an essential stop-loss point for traders.
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<p>The post Polygon’s Recovery: A Breakout for the Token? first appeared on CoinBuzzFeed.</p>
