A major announcement by the Polygon network regarding the development of its network was just made. The timing of this announcement also happens to come at an appropriate moment, considering MATIC’s strong upside so far this month.
The network has announced that zkEVM, its first EVM-compatible layer 2, scaling solution, is now available. This will allow for lower gas prices, which could attract more users to MATIC network.
As a result, MATIC may experience higher demand, hence potentially contributing to the altcoin’s price rally.
MATIC’s price recovery has been remarkable, having bottomed at 0.31% in June.
It was valued at $0.9163 on the 20th of July, a significant increase from its June lows. Bullish price action drove the price higher than its 50-day moving mean (MA) by over 70% and closed in on the 200 day MA.
Source: TradingView
MATIC bulls displayed some weakness in the 48-hours ending on 20 July. After the price pushed into an overbought area according to the Relative Strength Index, (RSI), bullish pressure has slowed down.
The bearish pressure has been caused by small outflows registered in the RSI. MATIC may be due for a bearish correction, according to the current outlook.
What goes up?
The news about the new layer 2 scaling solution might be the reason why MATIC’s price action has avoided more downside in the last two days.
This announcement is in line with the network’s strong growth since July. With the most recent development, the network is poised for more growth.
Source: Santiment
The network’s growth has been in tune with MATIC’s profitability in the last four weeks according to its MVRV ratio. The MVRV ratio reached 65.54% on 18 Jul, which indicates that MATIC shareholders are making a lot of money in the last 30 day.
The Polygon network’s increased growth in the DeFi landscape has also brought forth more demand for MATIC cryptocurrency outside of exchanges.
As a result, MATIC’s supply outside exchanges has been on a steady climb.
Source: Santiment
MATIC is still in demand and its remarkable price action suggests a higher probability of a rebound.
The 30-day realized market capital recently reached 448.65 MATIC. This indicates that the selling pressure is growing and that the price will need to yield to the bears soon.