Despite a challenging week in the crypto market, Chainlink (LINK) managed to see a brief respite with a gain of over 4%. This positive movement was supported by the accumulation of over 6.2 million LINK by whales. The current value of these holdings is estimated to be around $76.88 million according to popular crypto analyst Ali Martinez. This accumulation by large holders indicates a sense of confidence in the crypto asset, even as it experienced a drop of nearly 10% over the week amidst a broader market downturn.
Experts are optimistic about a potential 10% recovery in the price of Chainlink, citing on-chain metrics as a key indicator. One significant observation is the decrease in the supply of LINK on exchanges by nearly 3% in the past two weeks. This reduction in available supply typically alleviates selling pressure, creating a favorable environment for a price recovery. Additionally, the 30-day Market Value to Realized Value (MVRV) ratio currently stands at -9.34%, historically seen as a critical zone for price reversals. A negative MVRV ratio often suggests that the asset is undervalued, increasing the likelihood of a price rebound as market sentiment shifts.
Traders realized losses amounting to over $47 million from June 24 to July 8, indicating a trend of capitulation that may signal an impending recovery. From a technical analysis perspective, Chainlink showed promising signs with the $13.84 level aligning with the 23.6% Fibonacci retracement from its recent peak in March to the July low. A successful climb back to this level could lead to a strong recovery for LINK. Furthermore, the asset dipped into the Fair Value Gap (FGV) range between $11.62 and $12.11, gathering liquidity for its next target range of $13.73 to $14.24.
The recent accumulation by whales, positive on-chain metrics, realized losses, and technical analysis signals all point towards a potential bullish outlook for Chainlink. Despite the challenges faced by the crypto market, LINK seems to be positioning itself for a resurgence that could see significant price gains in the near future.
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