Polygon (POL) is facing significant bearish pressure, with its price declining by 12% in the last 24 hours. Despite a surge in dApp volumes, the overall market sentiment remains negative. However, the oversold RSI suggests a potential bullish reversal.
Polygon (POL) has been on a steep downtrend, dropping by 12% in 24 hours to trade at $0.457 at press time. Amid this drop, trading volumes spiked by 33% to $248M. Polygon has been facing bearish pressure, as the price has declined by around 33% in the last 30 days. This performance has had a negative impact on wallet profitability, with the percentage of wallets that are in losses surging to 91%.
When many wallets are in losses, it causes negative market sentiment that results in further price declines. Moreover, holders might choose to sell to minimize their losses, resulting in additional sell-side pressure.Polygon’s Relative Strength Index (RSI) on the altcoin’s four-hour chart shows that the token is oversold. This metric has dropped to a value of 23, which is its lowest since mid-December. An oversold RSI usually precedes a correction to the upside. Moreover, looking at past trends, POL tends to start a rally whenever the RSI reaches oversold levels. As such, the altcoin could be poised for a recovery.In fact, the ADX line is rising, an indication that the ongoing bearish trend is growing strong and POL could drop to the 1.618 Fibonacci level ($0.416).However, if the selling pressure eases as buyers consider the oversold RSI an ideal entry point, it could result in a bullish reversal, pushing the price to $0.538.Data from DappRadar showed that dApp volumes on the Polygon network have increased significantly. In the last hours, these volumes soared by 18% to $244M and hit the highest level in six days.However, despite this increase, transactions had dropped to below $1M while the number of Unique Active Wallets (UAWs) also dropped.Polygon’s Long/Short Ratio showed that the momentum was bearish at press time after dropping to 0.885. This drop indicated that the number of short positions was slightly more than the number of long position
Polygon POL Crypto Bearish Trend Oversold RSI Bullish Reversal Dapp Volumes Market Sentiment
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