According to on-chain information, Polygon (MATIC) presently lies within the area where it previously triggered gains of approximately 112% and 87%. In simpler terms, the data from the blockchain suggests that this location has historically been a strong buying opportunity for MATIC, leading to significant price increases.
Polygon 30-Day MVRV Ratio Is Significantly Negative Currently
According to an analysis by Ali, a market expert, posted on X, the MATIC token’s 30-day MVRV ratio presents a historically bullish sign. In simpler terms, the MVRV ratio is an on-chain metric that calculates the relationship between Polygon’s current market value and the worth of its coins last sold in the market.
The realized cap is a method for determining a cryptocurrency’s total worth. Instead of using the current market price of Matic as its value, this model assumes that the true value lies in the price at which the coin was last traded on the blockchain.
In simpler terms, the price of a coin last paid during a transaction is what’s considered its current purchase price. Therefore, the total value of all these costs adds up to give the overall realized cost basis for all coins in circulation.
In simpler terms, the realized cap represents the overall investment made by investors in a particular asset. The Market Value to Realized Value (MVRV) ratio then calculates the current market value against this initial investment. By examining the MVRV ratio, we can gain insights into the profitability or loss-making status of the entire market.
Here’s a chart displaying the Polygon MVRV ratio trend over the past 30 days. This indicator reveals the profit and loss situation for investors who recently made purchases.
In the given graph, the 30-day MVRV ratio is represented as a percentage. A 0% value indicates that the market capitalization and realized capitalization are balanced in the market.
In simpler terms, the Polygon indicator has experienced a significant decrease in value lately, causing it to move deeply into negative numbers. As a result, investors who purchased within the past month are facing substantial losses.
The current metric readings are lower than usual, which has traditionally led to profitable purchases of MATIC. Previous entries into this zone have resulted in a price increase of 112% and 87% for MATIC according to the analysis.
An intriguing theory for this trend could be that when 30-day investors face losses, they sell less frequently due to limited profits. Consequently, market selling pressure decreases, creating conditions suitable for price bottoms to emerge.
In other words, it is yet to be determined if Polygon will follow its previous trend and experience another surge, and if so, how big that surge might be.
MATIC Price
In the last 24 hours, the price of Polygon has risen by 3%, surpassing the $0.93 mark. It’s plausible that the MVRV (Moving Average Value Realized) buy signal has been triggered due to this recent increase.
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2024-04-08 19:16