Should You Buy Polygon Coin at $0.6 Dip? On-Chain Metric Points to Oversold Asset

Over the past seven weeks, the Polygon coin price has witnessed a steady downtrend under the influence of a falling wedge. The two downsloping trendlines of this pattern acted as dynamic resistance and support, leading the MATIC price from $1.29 to $0.588, registering a 54.3% loss. However, the downward momentum stalled at $0.625 support signals the potential for bottom formation amid the Bitcoin halving.

Also Read: Polygon Price Fall to 22-Month Support Hints Best Dip Opportunity of 2024

MATIC’s Negative MVRV Z-Score Hints at Undervaluation

For nearly two weeks, the polygon coin price has been consolidating in a narrow range between $0.772 and $0.588 horizontal level. This lateral movement indicates the positive sentiment around Bitcoin halving has stalled downward pressure but still lacks sufficient momentum to lead high recovery.

By the press time, the MATIC price trades at $0.72, with an intraday loss of 1.22%. The long-wick rejection at the overhead trendline indicates the asset is poised to retest the lower support signaling the continuation of the sideways trend.

However, an analysis of broader trends indicates the polygon price is wavering above the support trendline of a 2-year-long symmetrical triangle pattern. If the pattern holds true, the altcoin is at a significant bottom which should trigger a new recovery cycle to hit the triangle’s upper boundary. 

Moreover, in a recent analysis shared by the prominent trader @alicharts, key indicators suggest a potential buying opportunity for Polygon’s native token, MATIC. The tweet highlights that the 30-day, 365-day, and Market Value to Realized Value (MVRV) Z-Score Ratios are all trending in the negative domain. 

The 30-day, 365-day, and MVRV Z-Score Ratios for #Polygon are all in the negative, indicating that now might be the perfect time to buy into the $MATIC dip! pic.twitter.com/rhXNOyCsDe

— Ali (@ali_charts) April 23, 2024

This confluence of indicators is often interpreted by traders as a signal that an asset is undervalued and could be poised for a rebound, marking what could be an optimal entry point for investors.

Thus, The MATIC is well-posited for a bullish reversal setting a potential target to $1.22.

Technical Indicator

• Relative Strength Index: The daily RSI slope rebounded from the oversold region highlights the buyers are accumulating this asset at a discounted price.
• BB indicator: The downtick in the lower boundary of the Bollinger Band indicator highlights the price is yet to give a better signal for reversal.