POL pulls back as sustained selling dominates price action

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Polygon drops 7.39% today to $0.1124

Highlights

Polygon has permanently burned 100 million POL tokens, reducing its circulating supply by about 1%.
An additional 25 million token burn is planned, but broad selling pressure continues to weigh on price action.
POL/USD dropped 7.39% to $0.1124, with indicators showing bearish momentum and price expected to trade between $0.1067 and $0.1181.

Token liquidity tightens as Polygon implements new supply burns

Polygon has permanently removed 100 million POL tokens from circulation through on-chain revenue burn, accounting for roughly 1% of total supply, according to an announcement by co-founder Sandeep. This completed burn action reduces the available float, mechanically affecting token liquidity conditions in the market. Polygon has also indicated plans for a further 25 million token burn, signaling continued management of outstanding supply, though price action has remained under broader selling pressure.

Bearish momentum dominates amid oversold signals and resistance constraints

On the hourly chart, POL trades below both the MA-20 at $0.12 and MA-50 at $0.1195, while remaining above the long-term MA-200 at $0.0885. Immediate resistance is set by the Ichimoku Kijun at $0.1193, while nearby support stands at $0.1067. Momentum indicators confirm prevailing negative sentiment, with MACD and ADX both signaling a sell bias. RSI sits deep in oversold territory at 36.9, and Stochastic RSI along with CCI also indicate oversold conditions. Bearish dominance is further substantiated by negative readings in Bull/Bear Power and the Awesome Oscillator.

Downside risk elevated as volatility defines short-term trading range

In the short term, POL is expected to trade within the $0.1067 to $0.1181 band, reflecting its recent volatility. Probabilities favor further downside, with a 71% chance of additional declines versus 29% for a reversal above resistance. The baseline outlook points to sideways movement within this typical volatility corridor. A break above $0.1193 would open the way for a bullish scenario, while a drop below $0.1067 could trigger further selling.

Anton Kharitonov, expert at Traders Union, sees POL locked in a bearish technical structure. Despite the significant token burn, selling pressure dominates and momentum indicators remain negative. Key resistance at $0.1193 must be reclaimed before sentiment improves. "As long as POL trades below its short-term resistances, I remain cautious and do not expect a reversal to hold without clear confirmation."

Previously it was reported that Polygon's major token burn and network enhancements were driving scarcity and supporting demand. The latest price action now signals a shift toward heightened downside risk, making the $0.1067 support level a critical threshold to monitor for potential further selloffs.

Source of Data: POL Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.