- Polygon exhibits bullish on-chain metrics.
- Technicals also back the prediction, targeting MATIC price in Q2 to be 60% higher.
- In addition, Dehli hard fork will improve network performance.
YEREVAN (CoinChapter.com) – Polygon’s token MATIC has experienced a 36% drop since the local peak of $1.56 on February 18. As a result, the token price slid to $1.0 on April 27. However, several factors point to a bullish quarter for Polygon.
#1 Polygon’s bullish on-chain metrics.
According to a quarterly performance report by the analytical platform Messari, the Polygon PoS chain recorded an average of 400,000 daily active addresses and added 22 million new addresses during the quarter.
In addition to being one of Ethereum’s scaling solutions, Polygon Labs is pursuing an aggressive business development strategy partnering with both Web3 and legacy companies, operating a venture arm, and developing a decentralized identity solution Polygon ID.
Furthermore, Polygon recorded a near-50% advance in market cap compared to Q4 2022, as the metric reached $10.2 billion by March 31. The boost in total fees stood at 92%, reaching $11.8 million in the same period.
Also read: MATIC Price Prediction: Polygon Breakout Suggests Fresh Rally To $1.25.
Polygon’s transaction volume remained consistent throughout the year, despite the crypto drawdown.
#2 Technicals suggest an over 60% boost in Q2.
As mentioned, MATIC declined 36% since the February peak. However, the token formed a pattern dubbed the “rising channel” since May 2022. The pattern entails two parallel trendlines and a relevant mid-range that take the token price incrementally higher through consecutive support and resistance retests.
The rising channel does not predict a bias after the token leaves the formation. However, it can still be instrumental in predicting short-term fluctuations. MATIC repeatedly retested the channel’s support in the previous four days, seeking additional assistance from the $0.96 line, which has been relevant since May 2022.
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If the rising channel remains applicable, MATIC could see a 60% bullish move in the current quarter, potentially reaching the target of approximately $1.7.
#3 Polygon’s Dehli hard fork to improve network performance.
Polygon launched the Delhi hard fork in January 2023 to improve network performance and user experience on the PoS Chain. The hard fork aimed to reduce gas spikes and address chain reorganizations.
The changes would make the network more predictable and user-friendly, particularly for developers and validators.
By increasing the denominator from 8 to 16, the growth curve can be flattened. These results were backtested against historical Polygon PoS mainnet data. The expectation is that the rate of change for the base gas fee will fall to 6.25% (100/16) from the current 12.5% (100/8) in an effort to smooth severe fluctuations in gas prices.
commented the Polygon team.
Admittedly, the hard fork did not go as smoothly as planned. In February 2023, there was a decrease in performance on the Polygon PoS Chain. It increased errors and lags in new blocks, causing a reorg to last 157 blocks or approximately five minutes.
Polygon co-founders Jayanti Kanani and Mihailo Bjelic stated that this event was due to a particular bug and are working to minimize chain reorgs.
Also read: Ethereum Price Breaking This Confluence Resistance Could Spark Fresh Rally.
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