Despite promising on-chain data, the altcoin market remains weak due to unusual market conditions. The price of Bitcoin (BTC) dropped following the release of higher-than-expected Producer Price Index (PPI) data ahead of the US market opening. Although PPI figures remain below 3%, the rise could signal an increase in consumer inflation, risking further declines in the cryptocurrency market.
Why is Polygon (MATIC) Affected?
The broader negative market sentiment has kept BTC below the $58,000 mark, which has impacted other cryptocurrencies, including Polygon (MATIC). Despite positive on-chain activity, MATIC’s price has declined. On July 11, the volume of large transactions reached $103 million, marking a 7-day peak. Whale transactions surged 15 times compared to the previous day, indicating increased network activity among institutional and large investors.
These large transactions, which exceed $100,000, often signify a recovery in network activity, positively influencing altcoin prices during upward trends. However, in this case, the price has continued to decline. At the time of writing, MATIC was priced at $0.49, down by 4%, while trading volume increased by 10%. This suggests that selling pressure is overwhelming buyer demand, pulling MATIC’s price further down.
What is the MATIC Coin Price Prediction?
The Elder-Ray Index, which gauges the power struggle between buyers and sellers, currently indicates a negative value, showing seller dominance. Given the falling price and rising volume, it’s likely that MATIC could rapidly decline to $0.42. However, if BTC recovers, MATIC could also rebound to $0.5, potentially leading to new peaks.
Investor Insights
Based on the current market conditions and on-chain data, investors can infer the following:
- High trading volume during price declines indicates strong selling pressure.
- A negative Elder-Ray Index reveals seller dominance.
- Institutional interest is evident from a surge in large transactions, although it hasn’t halted the price decline.
- Market sentiment plays a crucial role in price movements, despite positive on-chain signals.
Weekend trading volume is expected to weaken further. A potential catalyst for an uptrend could be the SEC’s approval of the S-1 Forms for Spot ETH ETF applications, with the listing date announced for Monday. Although experts anticipate July 15 as a crucial date, the SEC has yet to provide final approval.