The recent sell-offs triggered by Bitcoin’s flash crash have pushed most altcoins into the red. However, there are still exceptional reversals like LUNA while other altcoins like MATIC recover quickly. Establishing a new ATH has been MATIC’s goal lately, and with Bitcoin slowly recovering, the price of the Polygon token seems to be heading towards an ATH of $2.7.
So, will MATIC make a new ATH or will the price just rally to the $2.44 region as it did at the end of May?
Price action looks to favor the big performance
In the context of the whole market selling off, MATIC lost nearly 30% of its value and at one point was only $1.50 on December 4. However, the coin quickly recovered and soon surpassed $2.25. At the time of writing, MATIC is trading at $2.46, just below the $2.70 ATH and looks set to create a new ATH.
Despite gaining 28.35% on the daily chart, MATIC’s relative strength index (RSI) has yet to reach the overbought zone, providing room for further price gains. On the time MATIC rose above previous key resistance levels, the RSI increased significantly, giving an overheated signal.
Furthermore, the RSI bounced quickly after testing the overbought zone in early December. That process was almost parabolic in early May when MATIC established an ATH.
Additionally, MATIC’s circulating market cap has finally crossed the $16 billion mark at press time. Interestingly, the upside move seems to be triggered by some positive developments taking place on this layer 2 protocol.
Accumulation and support from institutional investors drive the price
Buying sentiment is an effective support factor for MATIC price. Specifically, on Nov. 6, 3,000,300 MATIC (worth $5,802,630 at the time) was transferred from Binance to an unknown wallet. This shows how an accumulation trend is in favor of the price.
The number of daily active addresses also increased while the active deposits that once fell slightly recovered well and highlighted the high network activity.
Furthermore, while short-term MVRV is unusual, long-term MVRV is not near overheating regions, which is also a good sign.
MATIC started to rise last week after exchange-traded product (ETP) issuer 21Shares announced it would list a MATIC-linked product on the Euronext exchanges in Paris and Amsterdam. However, while the on-chain indicators look bright, the retail crowd is not yet enthusiastic about the coin.
The relatively low trading volume is also proof of that. Therefore, a push from the retail crowd will be the deciding factor in MATIC’s race to ATH. Otherwise, the chances of a break above the $2.7 mark are lower.