MATIC Price Forecast: Uptrend hints at rally but whales signal otherwise

MATIC price is noting a potential bullish continuation of the ongoing uptrend, but another bearish signal is coming from the whales, who have been consistently selling for the past month now. For the Polygon token to rally now, these whales would need to accumulate, which could be a while.

MATIC price continues its incline 

MATIC price, at the time of writing, is observing an uptrend that began back in mid-October. The first stretch of the rally noted an increase of nearly 80%, and since then, the incline has been slow but consistent.

Since MATIC has not fallen through the uptrend line, a bounce back is likely, which could push the price above the $0.92 resistance line. Flipping this into support would boost the rally, sending the altcoins up by 22% beyond the $1.00 mark.

MATIC/USD 1-day chart

However, if the digital asset finds resistance from broader market cues and falls through the uptrend line, it would find support at the $0.80 mark. Losing this support would invalidate the bullish thesis and result in a crash to $0.72.

Whales could cause the rally to slow down

On-chain metrics hint at the uptrend potentially slowing down since the whale addresses and other large wallet holders are acting relatively bearish compared to price action. Addresses holding between 100,000 MATIC and 1 million MATIC have been dumping their holdings for the past month.

Since mid-December, about 9 million MATIC has been sold off by the aforementioned addresses, bringing their total holding to 237.73 million MATIC as of the moment. 

MATIC whale addresses

The Market Value to Realized Value Ratio (MVRV) also suggests that there is some time before the MATIC price could begin recovery. The MVRV ratio is an indicator that is used to assess the average profit/loss of investors who purchase an asset. The seven-day MVRV ratio measures the average profit/loss of investors who purchased an asset in the past week. 

At the moment, the seven-day MVRV sits at 1.8%, which indicates that investors who purchased MATIC in the past week are sitting at a 1.8% loss. Generally, when the MVRV value hits anywhere between -5 % and -12 %, it is often followed by recovery rallies, which is why this area is termed an “opportunity zone” and an ideal place for accumulation.

MATIC MVRV ratio

Since the indicator is above the threshold, there is still some time before MATIC price witnesses accumulation-induced rallies, which would act as a major trigger in pushing the altcoin towards a 22% increase.