As Chainlink’s LINK token experienced a price drop of over 5% in the last 24 hours, an intriguing on-chain development has raised optimism amongst investors.
A so-called “smart money” cryptocurrency whale wallet purchased over $6.9 million worth of LINK from the Binance exchange amidst the decline. This whale now holds over 417,000 LINK, having previously traded the token profitability this year.
Keypoints
- Smart money wallet accumulated over 400,000 LINK from Binance amidst recent price drop, having previously made big profits on LINK trades
- LINK price dropped over 5% in last 24 hours but is trapped within weekly supply zone between $16-18 since early November
- If LINK breaks above $17 resistance, next target could be $34
- On-chain metrics like active addresses and stablecoin deposits point to growing user adoption and capital inflows
- LINK transaction volume and valuation metrics suggest token may be undervalued currently
The accumulation comes at an interesting time for LINK’s price action. After rallying from $5 in late July to over $17 in early December, LINK has been rangebound between $13-17 for the past few weeks. It is currently trapped within a key weekly supply zone between $16-18 which has held as resistance since early November.
Breaking above this supply barrier could signal a continuation of LINK’s uptrend. With the weekly Relative Strength Index and Awesome Oscillator pointing upwards still, there is momentum for prices to push higher. The first target upon breaking $17 would be a test of $20. But the crucial level for LINK bulls to watch is the $34 mark which would represent a psychological milestone.
On-chain data adds to the bullish narrative for LINK. Transaction and valuation metrics suggest growing adoption and possible undervaluation. Active wallet addresses interacting with LINK saw a 63% surge in December per Santiment. Tether and stablecoin deposits are also rising, hinting at fresh capital ready to buy LINK dips. And Network Value to Transactions Ratio declines indicate user growth outpacing price gains recently.
- With whales accumulating, technicals pointing upwards still, and adoption metrics rising, LINK looks poised to make an attempt at its overhead supply zone.
- A break above $17 could see a rally to $20 or even $34.
- However, failure to beat this resistance opens the risk of a fallback towards $13 support or lower.
- But overall blockchain activity suggests the LINK ecosystem continues growing.
