Polygon (POL) is facing significant downside pressure after its recent uptrend collapsed at the $0.12 resistance level. The altcoin has now closed at lower lows for two consecutive sessions, breaching the $0.11 support floor to hit an intraday low of $0.105. At the time of writing, POL was changing hands near $0.108, representing a 12.3% decline on the daily chart. Trading volume has also contracted sharply, falling 34% to $157 million, signaling a notable reduction in market participation.
Polygon Faces Intense Bearish Pressure
The rejection at $0.12 on August 25 came despite a massive 690% surge in exchange outflows, a metric typically associated with strong buying pressure, according to data from CoinGlass. However, that buying momentum proved short-lived as investors quickly shifted to selling, driving the asset lower under heavy bearish pressure.
Derivatives Data Shows Leverage Exiting the Market
On the derivatives front, the bearish narrative is reinforced by declining open interest and volume. CoinGlass data indicates that POL’s Open Interest dropped 11.3% to $111 million, while derivatives volume plunged 38% to $157 million. The simultaneous decline in both metrics suggests that leverage is leaving the market, with traders actively closing positions rather than opening new ones.
Futures market flows corroborate this trend. Over the past 24 hours, POL recorded $49.43 million in futures outflows against $39.3 million in inflows, resulting in a netflow decline of 196% to negative $3.04 million.
Spot Market Sell Volume Dominates
Seller dominance extends to the spot market. Data from Coinalyze shows that Polygon registered 139 million in sell volume over the same period. Historically, such persistent selling pressure across both spot and derivatives markets weakens market structure and often precedes further price declines.
Technical Indicators: Mixed Signals
From a technical perspective, the Relative Strength Index (RSI) has formed a bearish crossover, dropping to 69. While this crossover signals rising selling momentum, the RSI remains within the bullish zone (above 50), indicating that both buyers and sellers are active, though sellers have not yet fully seized control.
Conversely, the Directional Movement Index (DMI) paints a more resilient picture. The Positive Directional Indicator (DI+) jumped to 45, while the Negative Directional Indicator (DI-) fell to 12, with the Average Directional Index (ADX) rising to 50. This configuration suggests that upward momentum remains strong and has historically preceded trend continuation. Despite aggressive selling, bulls appear to be holding the line, keeping the uptrend intact.
Key Support Levels to Watch
The immediate battleground is the $0.10 psychological support level. If buyers can defend this floor, a recovery toward the $0.12 resistance is likely, with $0.14 serving as the next key upside target. However, a failure to hold $0.10 would likely trigger a deeper correction toward $0.094.
Final Summary
- POL faced rejection at $0.12, dropping 12.3% and breaking below $0.11 support to a low of $0.105.
- The decline was driven by heavy selling pressure across spot and derivatives markets.
- Derivatives data shows leverage exiting (falling Open Interest) and negative futures netflows.
- Technical indicators are mixed: RSI shows bearish crossover but remains bullish; DMI/ADX signals strong underlying uptrend momentum.
- $0.10 support is critical; a hold could lead to a reclaim of $0.12, while a break targets $0.094.
Sources: CoinGlass, Coinalyze, TradingView
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