Polygon’s native token, POL, has recently captured market attention with a significant price rally, achieving a three-month high. This surge comes amidst a notable increase in network activity and renewed buyer interest, although the market is also exhibiting cautious signs of profit-taking. Investors are closely monitoring these mixed signals as POL navigates its current upward trajectory.
Polygon's Network Sees Renewed Demand
The recent appreciation in POL's value is strongly underpinned by a resurgence in Polygon's network usage. Active Addresses on the network climbed by 25%, signaling revived user demand, while Daily Transactions recovered to 4 million, reflecting heightened on-chain activity. A key driver for this transaction boost was the upgrade of Polygon PoS USDT to the USDT0 standard, positioning Polygon as a leader in transacting USDT0 addresses. Furthermore, Polygon is steadily emerging as a stablecoin hub for Singapore, processing increasing volumes of XSGD transfers, which further solidifies its utility and adoption within the decentralized finance landscape.
Conflicting Market Signals: Accumulation Meets Profit-Taking
Despite the strong network fundamentals, the market for POL presents a nuanced picture. Significant buyer accumulation was observed when prices dipped to $0.23, with Buy Volume comfortably exceeding Sell Volume for two consecutive days. This indicates strong investor confidence at lower price points. However, as POL rebounded, an accelerated pace of profit-taking became evident, with profitable transactions significantly outweighing losing ones on-chain. This rush to cash out is also reflected in positive Spot Netflows to exchanges, suggesting increased selling pressure. While momentum indicators like the RSI and Directional Movement Index point towards continued bullish sentiment and buyer dominance, the high profit-taking activity warrants caution, as it could trigger potential corrections in the near term.
