Chainlink Declines 6%: Rally Over Or Is There More To Go?
15 Novembre 2023 - 2:00AM
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The Chainlink rally has slowed down recently; here’s what the
various LINK on-chain metrics look like to see if the surge has
hope of a restart. Chainlink Has Registered Some Drawdown In The
Past 24 Hours Just during the weekend, Chainlink had been floating
above the $16 mark, but winds seem to have shifted for the coin in
the past couple of days, as it has registered some drawdown. During
the last 24 hours alone, LINK has dropped around 6%, leading to its
price slipping below the $14 level. The chart below shows how the
cryptocurrency has performed in the past month. LINK appears to
have gone down in the last two days | Source: LINKUSD on
TradingView As displayed above, Chainlink had been riding some
sharp bullish momentum in this period before this latest plunge, as
the asset had more than doubled in value. Despite the decline, LINK
is still up over 90% in the past month, which is an impressive
return. Related Reading: Bitcoin Could Plunge To $30,200 If This
Level Is Lost: Analyst Naturally, the investors may be wondering
now if the asset has already hit its peak for this rally or if
there is more to come shortly. It’s hard to say anything about
that, but perhaps on-chain data could provide some hints. LINK
Activity Has Been Relatively High Recently In a new post on X, the
market intelligence platform IntoTheBlock has shared the data of
some Chainlink on-chain indicators. First, when the firm made the
post, about 56% of the asset’s investors were sitting on some
profit. Looks like 39% of the holders had been underwater | Source:
IntoTheBlock on X The cryptocurrency had then been floating at
higher levels than currently (although not too high), so more LINK
addresses would have entered a state of loss by now. Generally,
investors in profit are more likely to sell at any point, so a
large amount of them being in the green could raise the probability
of a selloff. Some Chainlink investors are currently harvesting
their profits, but the profitability ratio is still not skewed that
much towards profits. Next, IntoTheBlock has talked about the
number of transactions on the network. The value of the metric
seems to have been going up recently | Source: IntoTheBlock on X
“The Chainlink network is showing many positive signs in terms of
transaction data,” says the intelligence platform. “Notably, we see
a healthy increase in the number of transactions.” The number of
transactions is up 436% from the monthly lows, and as is usually
the case, the volume has also spiked alongside this rise. LINK
volume hit $515 million last week | Source: IntoTheBlock on X The
transaction activity being high suggests there is interest behind
the asset, and so, the price action shouldn’t go stale just yet.
However, the volatility due to this activity can go either way, as
the asset is already witnessing. Related Reading: Chainlink Forms
Sell Signal, Analyst Predicts Pullback To This Level A metric that
could more solidly point at a direction for the cryptocurrency is
the large holder netflow, which keeps track of the net
accumulation/distribution behavior over the last month for LINK
holders carrying more than 1% of the supply. The metric's value has
been positive recently | Source: IntoTheBlock on X As is visible in
the chart, the large Chainlink holders have been buying recently,
which could potentially be a positive sign for the asset. This
doesn’t have to mean that the rally would restart shortly, of
course, but it does provide some support for the idea. Featured
image from Shutterstock.com, charts from TradingView.com,
IntoTheBlock.com
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