POL Plummets 6% Amid Inflation Fears: Key Levels to Watch

POL Drops 6% on Inflation Shock

Polygon's POL token experienced a significant downturn on Thursday, shedding 6% of its value as unexpectedly high U.S. inflation figures triggered widespread selling across risk assets.

The token's price fluctuated considerably over the past 24 hours, initially rising from $0.25 to $0.26 before reversing course. Data from CoinDesk Analytics indicates a 10% trading range during this period.

A strong wave of selling pushed POL down to $0.24, accompanied by a surge in trading volume to 1.1 million units – more than triple the average. The $0.26 level now presents a key resistance zone.

Inflation Data Fuels Selloff

The price drop coincided with a broader market downturn prompted by the U.S. Producer Price Index (PPI), which revealed a 0.9% month-over-month increase in July. This marks the largest increase in over three years. The PPI data, which tracks wholesale inflation, has diminished expectations for near-term Federal Reserve rate cuts, putting pressure on assets considered higher risk.

The CoinDesk 20 Index (CD20), a benchmark for the broader crypto market, fell by 4% during the same timeframe, as profit-taking intensified across major cryptocurrencies. POL was last trading near $0.24, with technical indicators suggesting potential for further price declines. Traders and investors are closely monitoring these developments, especially those building on or interacting with the Polygon network. For projects undergoing protocol updates or those launching new dApps, robust security audits are crucial. Codeum offers smart contract auditing services to help ensure the integrity and reliability of blockchain-based applications.