Polygon’s POL token found strong support at the $0.10 level, bouncing 15.25% in a single day after retesting it. This positive response coincided with a significant milestone of 3 million POL burned in one day and a monthly total of 25.7 million tokens burned. Despite these supportive on-chain actions, the asset remains in a longer-term downtrend and is currently range-bound, with its next major move likely dependent on broader market direction led by Bitcoin.
The Polygon (POL) token rebounded strongly after defending the key psychological support level of $0.10 for the second time in just over a month. This bounce resulted in a 15.25% gain on Monday, the 2nd of January.
The rally in early January occurred alongside a notable spike in the network’s token burn mechanism. A record 3 million POL was burned in a single day, contributing to a monthly total of 25.7 million, which AMBCrypto reported as one of the largest monthly burns.
However, the wider market remains a dominant factor for the altcoin’s price action. The selling pressure on Bitcoin (BTC) created fear that did not bode well for Polygon bulls.
On the weekly timeframe, the trend for POL has been bearish since December 2024. The daily chart shows the asset is currently constrained within a range between the $0.10 and $0.18 price levels.
Technical indicators show a balance between buying and selling pressure. The On-Balance Volume (OBV) did not make new lows even as price tested its recent bottom.
The immediate price ceiling is seen near the $0.1325 level, which previously acted as support. Analysts note the $0.13 zone is a short-term supply area that could prompt a bearish reaction.
Ultimately, Bitcoin’s price movement is expected to have a major influence on POL’s trend. A bearish short-term bias for Bitcoin remains until the $79.4k local resistance is breached.
Traders are advised to wait for clearer signals before taking significant action. A rejection at the $0.13 supply zone could present a selling opportunity, while a reclaim might open a path toward $0.186.
