The Last Sellers Are Out – Bitcoin’s Next Leg Is Loading 
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- MATIC saw a bullish structure break over the weekend
- Its rejection at the mid-range mark combined with a lack of accumulation was worrisome for the bulls
Polygon [MATIC] saw a large uptick in its daily active addresses and transactions. The positive developments on-chain was accompanied by a steep decline in total value locked (TVL) over the past week. The price action of MATIC showed a token stuck within a range for six weeks.
Is your portfolio green? Check the Polygon Profit Calculator
A previous analysis by AMBCrypto dated 14 October noted that MATIC reflected strong bearish sentiment in the market. While the indicators and price action continued to reflect a bearish bias, over the past two days MATIC climbed from $0.515 to $0.544.
The range formation could be a key factor in the coming weeks
Source: MATIC/USDT on TradingView
The 12-hour chart above showed a range formation (yellow) that extended from $0.5 to $0.588, with the mid-range mark at $0.544. The range lows were bounded by a bullish order block (cyan box) on the weekly chart that extended to $0.315. To the north, there was an H12 bearish OB (red box) that MATIC bulls have not yet breached.
This range was credible because MATIC respected the high and the low. Most importantly, the mid-range level also served as support and resistance over the past six weeks and drew attention to the validity of the range plotted.
The market structure was bullish and a higher low was formed at $0.5128 on 15 October. However, the volatility on Monday (16 October) saw MATIC pump to $0.544 and rejection. The Relative Strength Index (RSI) was at neutral 50, and the On-Balance Volume (OBV) was also at a local resistance that reached back to September.
On the other hand, the Chaikin Money Flow (CMF) noted significant capital flow out of the market. Put together, the indicators pointed toward neutral momentum and a slightly stronger base of sellers. This meant a breakout past $0.544 could be protracted.
The fall in key metrics was a concern for long-term bulls
Source: Santiment
The price action underlined a range formation for MATIC. A phase of accumulation would be amazing for the bulls, but unfortunately for them, the Mean Coin Age metric has been in a steady downtrend since September. It showed selling pressure behind the token. The Daily Active Addresses metric was also in decline during the same time.
Realistic or not, here’s MATIC’s market cap in BTC’s terms
The Market Value to Realized Value (MVRV) ratio was below zero to show an undervalued asset, but this was not enough to excite the bulls. The spike in dormant circulation when MATIC tested the range lows suggested sentiment was fearful. Hence, buyers waiting for another retest of $0.5 could exercise more caution than the previous retests and target smaller bounces to take profit.
