- SOL and MATIC are part of the tokens that FTX could liquidate this week or next.
- Before the liquidation, SOL may continue to consolidate around $18 unless selling pressure appears.
- MATIC, on the other hand, may fall below $0.50, as indicated by the OBV.
Despite enduring torrid periods over the past few weeks, the crypto market may be on the verge of another nosedive. This is because FTX, the exchange that brought the market to its knees in 2022, is getting ready to liquidate some of its assets, and Solana (SOL) and Polygon (MATIC) are part of it.
According to crypto podcast Crypto Town Hall, approximately $650 million worth of SOL could be sold by FTX soon. Other assets held by the exchange, and could also be sold include Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), and a host of others.
While SOL was the highest holding of FTX, MATIC was the lowest with $39 million. SOL being top of the others may not be surprising. This is because estranged CEO Sam Bankman-Fried (SBF) never hid his admiration for the token when the exchange was still active.
For this reason, SOL was one of the cryptocurrencies deeply affected by FTX’s collapse. So, it is possible that another scenario of the capitulation could be on the cards.
At the time of writing, SOL exchanged hands at $18.28, on the back of increased selling pressure as shown by the 4-hour chart. Since September 8, SOL has attempted to rise into the $20 region. But the resistance at $19.58 ensured that it did not.
Little did bulls know that sellers had other plans to plunge the price to $18.16. However, the Accumulation/Distribution (A/D) line had risen to 15.17 million. A rising A/D trend alongside a decline in price suggests a weakening seller strength. Hence, this divergence signals increased demand, meaning SOL’s value could stabilize.
However, it is likely that the A/D will lose hold on the upward momentum if FTX finally liquidates. As a result, SOL may drop as low s $15.
MATIC’s market structure was also similar to SOL. At press time, widespread sell-offs had
caused MATIC to fall to $0.52. Also, previous attempts to rise to $0.55 have been met with rejection at $0.54 at different times.
Furthermore, there was a difference between the SOL and MATIC conditions on the charts. While SOL had some form of demand, MATIC did not. As per indication from the On Balance Volume (OBV), MATIC’s volume pressure was decreasing.
Typically, a rising OBV could lead to higher prices. Therefore, the falling OBV in MATIC’s case reflects another possible move in the downward direction.
In conclusion, MATIC could fall below $0.50 irrespective of FTX’s liquidation period. It may also get worse for the token after the exchange liquidates. But SOL may continue to consolidate around $18 unless FTX sells off the token very soon.
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