A Cumberland wallet is aggressively withdrawing tokens from major exchanges including Binance, Gate, and Coinbase. Analyst Nazoku reported that the wallet withdrew 14.6 million Polygon [POL], worth $1.41 million.
After the withdrawal, these tokens were moved to another wallet. Usually, when Cumberland pulls tokens off exchanges, it removes supply from order books.
Often, such a directional move brings about temporarily reduced selling pressure. Cumberland, as the money maker, often makes withdrawals to rebalance inventory for various reasons, including liquidity provision.
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Polygon is still under intense selling pressure
Despite Cumberland’s token withdrawal, the market is experiencing increased sell-side activity from both institutions and individual investors.
Days ago, for example, AMBCrypto reported that Polygon saw renewed pressure from FalconX. The entity deposited 14 million into Binance.
This selling has persisted for a prolonged period. In fact, the Polygon Exchange Supply Ratio has been on a strong upward trajectory over the past week.
The ratio jumped to a two-week high of 0.00035. When ESR is on the rise, it implies that more POL has flowed into exchanges.Â
Often, rising exchange inflows tend to increase supply available for immediate selling, which often leads to weakened market structure and could also result in a price drop.
Why is the market activity increasing?
Since facing rejection at $0.98 four days ago, POLÂ has closed at lower lows. As a result, the altcoin fell to a low of $0.94.
Since doing so, the altcoin has traded within a thin margin, mostly hovering around $0.095 and $0.094. At press time, Polygon was trading around $0.095, up slightly 0.98% on the daily charts.
Additionally, the altcoin’s trading volume climbed 158% to $83 million, reflecting increased market participation.
A look at both the Spot and Futures volume confirms this rising market activity. The Spot volume rose 35% to $8.17 million, marking a $2.9 million jump over the past 24 hours.
At the same time, Futures volume rose 15% to $38 million, marking a $6.1 million increase. A rise in both metrics suggests that investors have increased activity and deployed capital for strategic positioning.
What next for POL?
Polygon’s upside momentum has weakened substantially. When we look at the positive index of ADX with SMA, this indicator has been on a decline for two consecutive weeks.
The ADX also plunged and made a bearish crossover. At the same time, the negative index has held within a parallel line.
The setup suggests that the downside pressure is strong while the upside is weak. Typically, when this indicator is set in such a manner, it points to the potential for a major downside slip.
If the DI continues to drop, Polygon will most likely breach $0.09 and drop to $0.089. However, if the recent withdrawals reduce pressure, the altcoin will hold $0.094 and target a close above $0.099.
Final Summary
- A Cumberland-linked wallet withdrew 14.6 million POL worth $1.41 million from exchanges.Â
- Polygon holding within a thin margin, but increasing sell pressure risks a drop below $0.09.Â
