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Polygon (MATIC) Price Falls: A 2-Year Low

The price of MATIC, the token that powers the leading Layer 2 (L2) platform Polygon, has seen a major fall. On March 14, MATIC reached its year-to-date high of $1.22. However, it has not maintained this momentum. 

Polygon MATIC price decline chart
Source: https://medium.com/@AnthonyTGorman/how-to-unstake-matic-polygon-with-ledger-wallet-9a2fecc2fde5

Breaking Support and Continued Decline 

After consolidating within a range between April 14 and June 7, MATIC’s price broke below the lower line (support level) of the horizontal channel. Since then, it has declined by 33%. 

Polygon at a 24-Month Low 

As of now, MATIC is trading at $0.44. The last time the altcoin was at this price level was in July 2022. This marks a 24-month low for the token. 

On-Chain Analysis Reveals Decline in Demand 

An analysis of MATIC’s price performance on the blockchain reveals a notable drop in demand for the altcoin. This conclusion is drawn from the Price-Daily Active Address (DAA) Divergence metric. This metric compares how the price changes with the number of active addresses using the token each day. It helps determine if changes in the token’s price reflect changes in its network activity. 

 Negative Price-DAA Divergence 

Currently, MATIC’s Price-DAA Divergence returns a negative value of -35.59%. This measure last went over zero on October 24, 2023, for background. When this metric returns a value below zero, it suggests fewer daily active addresses are trading the asset. A value of -35.59% marks a significant decline in the active address count, signaling bearish sentiment for MATIC. 

Combined Reading of Price and Network Activity 

A combined reading of MATIC’s price decline and its negative Price-DAA Divergence suggests that both the token’s price and network activity on Polygon are decreasing. This decline in network activity supports the price drop, indicating reduced interest and trading volume for MATIC. 

Relative Strength Index (RSI) Insights 

MATIC’s Relative Strength Index (RSI) is currently at 21.17. The RSI measures whether an asset is overbought or oversold, on a scale from 0 to 100. When it’s above 70, it means the asset is likely overbought and could correct downward.  

Values below 30 suggest the asset might be oversold and could bounce back. MATIC’s low RSI of 21.17 indicates it might be oversold and could see a price increase. However, the strong bearish sentiment around it might hinder any immediate recovery. 

MATIC Price Prediction: Further Decline Possible 

Since June 7, the Elder-Ray Index has shown a negative value, indicating bearish dominance in the market. This index gauges the strength of buyers and sellers. When it’s negative, bears have the upper hand.  

To sum up, MATIC’s price has dropped to a two-year low of $0.44. On-chain metrics and technical indicators suggest ongoing bearish sentiment and decreasing network activity. The Elder-Ray Index reinforces the likelihood of further decline due to prevailing bearish pressures in the market. 

July 7, 2024 at 12:00 pm

Updated July 7, 2024 at 12:00 pm


Remember, investing in cryptocurrencies involves risks, and it’s important to conduct thorough research and seek professional advice before making any financial decisions. (Please keep in mind that this post is solely for informative purposes and should not be construed as financial or investment advice.)


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