Polygon's (MATIC) on-chain signal on Friday is hinting at a potential buying opportunity as many expect this Ethereum (ETH) scaling solution could surge in the coming weeks following the Ethereum ETF's delivery. immediately approved.
MATIC signals give good buying opportunities
Following the approval of the Ethereum spot ETF, many expect cryptocurrencies in the Ethereum-based ecosystem to increase in the coming weeks.
For example, many DeFi and Layer 2 tokens, including Polygon (MATIC), Uniswap (UNI), Lido DAO (LDO), Arbitrum (ARB), and Optimism (OP), have recorded double-digit gains during awaiting ETH ETF approval. Once ETFs have been approved, the expectation is that these tokens will increase along with ETH.
Of these tokens, MATIC's on-chain data shows it is at a good price to buy despite the recent price increase. Even though MATIC jumped 10% on Tuesday, 82% of holders are still out of profit, according to data from IntoTheBlock.
In/Out of the Money measures the average purchase price of an asset and compares it to its current price. If the current price is higher than the average purchase price, that address is profitable and vice versa if the price is lower. This indicator helps evaluate whether there are potential buying or profit-taking opportunities approaching an asset.
With 82% of holders not yet in profit and signals from ETH suggesting a bull run may be approaching, MATIC's current price represents a potential buying opportunity.
In/Out of the Money của MATIC
Additionally, 61% of addresses that bought around the current price of $0.722 — typically between $0.614 and $0.833 — are also not yet in profit, although their volume suggests that large holders are slightly profitable.
Trading volume increased from $17 million to $86 million, coinciding with an increase in buying by large investors. This points to bullish sentiment, as confirmed by IntoTheBlock's signal summary which is 'largely bullish.' Therefore, while MATIC's price does not yet reflect a bullish view, current prices may is a good opportunity to buy this asset ahead of a potential price increase.
MATIC signal
However, retail investors need to be cautious because MATIC has a whale holding rate of up to 60%. Tokens with large whale holdings risk exposing retail traders in the event of a rapid sell-off.
MATIC/USDT 4-hour chart
This bullish sentiment will be confirmed if MATIC breaks above May 6's $0.7778 resistance. However, if MATIC falls below May 23's $0.695 support, the bullish sentiment will be nullified. disable.
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