Polygon (POL) is making waves in the cryptocurrency market, with a staggering 426% increase in active addresses last week. This surge in user engagement signals robust network growth, even though POL’s price experienced a slight dip of 1.91%, currently trading at $0.4533. However, despite the minor price setback, technical indicators suggest that Polygon could be on the verge of a bullish breakout.
Polygon’s network growth surges – Identifying what it means for POL’s pricehttps://t.co/AF4zVsK5ks
— John Morgan (@johnmorganFL) January 11, 2025
Is a Bullish Breakout Coming?
The price chart of POL reveals a descending wedge pattern, often associated with bullish reversals. The recent double bottom near $0.4389 adds extra support, hinting at a potential rebound in price. For a significant rally to materialize, POL must break through the resistance level at $0.5324. If buying pressure continues to build, the price could rise higher, but sustaining this momentum will be crucial for escaping the current downtrend.
Network Growth Fuels Adoption
Polygon’s impressive network growth further boosts the case for a price rally. Active addresses spiked by 426%, indicating growing interest and adoption across the platform. Even more striking is the 1,134.82% increase in zero-balance addresses, reflecting heightened user engagement. While new addresses saw a slight decrease of 6.83%, the overall increase in active users is a promising sign of expanding adoption. As more users join the network, the likelihood of upward price movement intensifies.
Key Technical Signals Point to Potential Growth
The Relative Strength Index (RSI) for POL sits at 43.76, approaching oversold territory, which often signals potential price growth. Meanwhile, the Directional Movement Index (DMI) shows that the bearish trend is weakening. The +DI stands at 14.77, while the -DI is at 25.35. If the +DI crosses above the -DI, a trend reversal could be on the horizon.
In addition, Polygon’s exchange netflow recorded an inflow of 449.6175k tokens, reflecting a 0.23% rise in liquidity. This boost in trading activity could drive market volatility, possibly pushing POL past resistance levels.
Also Read: Polygon (POL) Faces 12% Decline, but Oversold RSI Sparks Hope for Rebound Amid Bearish Market Trends
With a strong network growth, key technical indicators, and rising user engagement, Polygon is positioning itself for a potential bullish breakout. If POL can break resistance and maintain momentum, a significant price rally may follow, reversing its recent downward trend. Keep an eye on POL as it continues to develop.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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