Polygon (POL) Price Forecast: 44% Drop Predicted, But Whales Accumulate

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Polygon (POL) Price Forecast: 44% Drop Predicted, But Whales...

Oleg Dimitrov
31 January, 2025, 06:22
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Polygon (POL) Price Forecast: Analysts Predict 44% Drop, But Whales Signal Recovery

Polygon’s Prolonged Downtrend Raises Concerns

Since reaching a high of $0.76 in December 2024, Polygon (POL) has been trapped in a persistent descending channel, characterized by lower highs and lower lows. Over the past month, this downward trend has intensified, with POL dropping 10.42% to a recent low of $0.38.

This continuous decline has sparked concern among analysts, with some predicting further losses. Ali Martinez, a well-known crypto analyst, has warned that POL could be on the verge of a 44% correction, potentially bringing its price down to $0.23—a level not seen in three months.

According to Martinez, a breakdown from the current descending pattern would confirm a continuation of Polygon’s bearish trajectory, signaling further downside.

Polygon (POL) Charts Indicate a Short-Term Rebound

Despite the ongoing bearish pressure, recent price action suggests that a short-term recovery could be underway. At the time of writing, Polygon was trading at $0.4053, reflecting a 1.22% increase on the daily charts.

One of the key indicators of this potential rebound is a bullish crossover, signaling increasing upward momentum. This crossover suggests that sellers may be losing strength, making way for buyers to step in.

Further supporting this scenario, Polygon’s Relative Strength Index (RSI) has bounced from 33 to 38, indicating a rise in buying pressure. If this trend continues, POL could break out of its short-term resistance and regain lost ground.

Whales Accumulate POL, Indicating Bullish Sentiment

A significant driver of this buying pressure is whale activity. On-chain data reveals that large holders’ net inflow has surged by 3,624.46%, jumping from 1.84 million POL to 68.53 million POL.

Ethereum Whales Accumulate Amid Price Drop, $2,350 Support Crucial

This dramatic increase in whale accumulation signals renewed confidence in Polygon’s long-term potential. Typically, when whales increase their holdings, it suggests that they anticipate a price recovery and are positioning themselves ahead of a potential rebound.

Additionally, Polygon’s stock-to-flow ratio has climbed to 1.43 million, implying that many investors are choosing to hold their POL tokens in cold storage rather than selling. This trend further reduces the available supply, potentially supporting a price recovery.

Is Polygon (POL) Undervalued? MVRV Ratio Suggests Buying Opportunity

Another key indicator pointing toward a possible price rebound is Polygon’s Market Value to Realized Value (MVRV) ratio, which remains in negative territory. A negative MVRV ratio often signals that an asset is undervalued, providing an attractive buying opportunity for investors.

Historically, whales tend to accumulate heavily during such periods, as they view the asset as trading below its fair value. This could explain the recent surge in whale-driven accumulation of POL.

What’s Next for Polygon (POL)? Key Levels to Watch

If this short-term bullish momentum continues, Polygon (POL) could reclaim the $0.44 level in the coming days. Should this level hold, further upside toward $0.47 is a strong possibility. However, if selling pressure resumes, a retest of $0.38 or lower could be on the horizon.

For now, Polygon’s price trajectory remains uncertain, but the combination of whale accumulation, a rising RSI, and reduced circulating supply suggests that a short-term recovery may be in play.

Traders should closely watch key support and resistance levels while monitoring on-chain signals for confirmation of a potential trend reversal.