Despite the downturn in the crypto market following Bitcoin’s recent rejection around $49K and a significant sell-off driving its price down to approximately $41,500, the altcoin sector is experiencing a noteworthy rally. In particular, Chainlink has emerged as a standout performer, registering substantial gains in the past few hours and successfully surpassing key resistance levels. As Bitcoin struggles with continuous selling pressure at its resistance lines and its market dominance declines rapidly, there is a growing bullish outlook for Chainlink price prediction in the near term, bolstered by an increasingly robust support level.
Chainlink Develops Robust Accumulation Zone
Chainlink’s token LINK has undergone a remarkable rebound following a substantial drop, where it momentarily fell below the vital $13 support level earlier in the month. This decline was largely linked to Bitcoin’s decline following the spot Bitcoin ETF approval by the US Securities and Exchange Commission (SEC).
Recent figures indicate that LINK is experiencing a “moderate decoupling” from its altcoin counterparts, as evidenced by its exchange ratio reaching a four-year low. When the exchange ratio decreases, it typically means there are fewer LINK tokens available on exchanges for trading. This reduction in available supply can lead to less selling pressure. With fewer tokens being sold, the price is less likely to be driven down by sell orders.
A lower exchange ratio often signals that more investors are holding onto their LINK tokens rather than transferring them to exchanges for sale. This holding behavior suggests that investors have confidence in the long-term value of LINK, expecting the price to rise in the future.
According to IntoTheBlock data, Chainlink has recently established a substantial demand zone. This zone, ranging between $14.8 and $15.2, has become a critical area of interest for accumulation.
A demand zone is essentially an area where a significant number of buyers have shown interest in purchasing an asset. In Chainlink’s case, this zone is particularly notable – within the price range of $14.8 to $15.2, approximately 17,650 addresses have acquired a whopping 85.13 million LINK tokens.
This substantial accumulation indicates strong investor confidence in Chainlink at these levels, suggesting that this zone could act as a robust support amid market’s volatility. According to Coinglass, LINK price witnessed a short-liquidation of over $1.1 million as the price went against sellers’ bets. With the NVT ratio decreasing even as the market value rises, it indicates that transaction volumes are outpacing the network value, pointing to undervaluation and the possibility for additional growth.
What’s Next For LINK Price?
LINK price surpassed the descending channel pattern, experiencing a significant surge to $15. However, the 4-hour’s candlestick featured a long wick, signaling that profits were taken at higher price levels. As of writing, LINK price trades at $15.3, surging over 0.6% from yesterday’s rate.
Currently, the price is facing selling pressure from bears as it aims to decline toward the breakout point, a level where buyers are anticipated to engage. The upward trend of moving averages suggests that bulls are slightly dominating, yet the RSI’s recent negative divergence calls for caution.
Should the price bounce back from the breakout level near the EMA20 trend line, buyers might attempt to drive the LINK/USDT above $17.1. This price point could present a robust obstacle, but if overcome, the pair might surge above $20.
The bears are currently attempting to send the price toward a fear zone by sending the price below the support line. If the LINK price drops below the EMA20 trend line, might witness significant liquidations, resulting in a rally toward $11.
If the price declines further, breaking below the SMA lines, it could signify the end of the uptrend. In such a scenario, the pair risks dropping to $8.
In the past few hours, there has been a significant increase in purchasing interest for LINK, as seen by the long/short ratio climbing above 1. Presently, this ratio stands at 1.1487, indicating a growing bullish momentum on the price of LINK, with nearly 54% of positions being long.
