Can It Hit $2 with $125 Million in Trades?

• Polygon (MATIC)  has gained 75% in the past month and is now trading at $0.9, with investors looking at $2 as the next major price target amid positive developments.
• In the first two weeks of November, investors placed over $125 million worth of MATIC futures contracts as investors’ interest in the token surged on the back of positive price movements.

Polygon is one of the most popular Layer 2 (L2) networks in the market, but its token MATIC has been underperforming for some time now. This has changed in the past few weeks as the token’s price surged towards the critical $1 resistance level. but is $2 an achievable target in the short term?

At press time, MATIC trades at $0.91 after a slight 2.8% dip in the past day amid a wider slowdown in gains by most large-cap cryptocurrencies. With a market cap of $8.46 billion, it’s the 11th largest crypto in the market, just ahead of Avalanche.

Despite the slight dip in the past 24 hours, Polygon has been one of the best performers in the top 20 cryptos in the past month. The token has gained 11.7% in the past month and 75% in the past month. In that time, it set a monthly high at $0.975, its highest level since early May.

Investor confidence in MATIC seems to be returning to the market, and the numbers are backing this. One platform shows that open interest in the derivatives market has doubled in the first two weeks of November.

MATIC Open Interest Surges 190% in 30 Days

Open interest is the total number of outstanding derivative contracts, such as futures or options, that have not been settled. It’s a measure of market activity and liquidity, indicating the flow of money and interest in a particular market. High open interest for an asset signifies considerable market involvement and interest, indicating enhanced liquidity and a more vibrant market for trading the asset.

Data by Coinalyze shows that a month ago, MATIC’s open interest stood at $86 million. It has skyrocketed since, and at press time, it stands at $250 million, a 190.6% rise in just 30 days. Analysts concur that if this open interest continues to rise, the crypto’s price could surge past $1 this month as institutional investors continue to throw their weight behind Polygon.

However, for MATIC, hitting $1 could be a big test. Data by IntoTheBlock shows that at $1, a large percentage of the current holders would have broken even and this could lead to a selloff. At its current price, only 36% of holders are in the money, with the majority, 57%, losing money.

Conversely, holders of 4.6 billion MATIC who purchased the token at $0.805 or more could be the token’s support if it starts to dip. This group, which consists of over 62,000 addresses, is projected to HODL if the price dips to this level and could be the reason it bounces back.