Chainlink (LINK), a popular decentralized oracle network cryptocurrency, has been experiencing a curious trend in recent weeks. While the price of LINK has dipped over 21% in the last month, on-chain data reveals significant accumulation by whales (large investors) who are snapping up the cryptocurrency. This seemingly contradictory behavior suggests a potential turning point for LINK, with a bullish outlook emerging despite the current market consolidation.
Whales Accumulate LINK Despite Price Drop
According to Lookonchain, a respected on-chain analytics platform, new whale wallets have actively been buying LINK. These fresh investors have withdrawn a substantial amount, totaling 2.08 million LINK (roughly $30.28 million), from Binance in the past week. This trend aligns with the behavior of existing LINK whales who have refrained from selling their holdings on exchanges over the last month.
Net Flow from Whales to Exchanges Dries Up
This strategic accumulation is further emphasized by the significant decrease in the net flow of LINK from large holders to exchanges. In the past 30 days, this flow has dropped a staggering 110%. This metric signifies that whales are more inclined to hold onto their LINK rather than sell.
Market Indicators Suggest Buying Opportunity
Furthermore, the net flow ratio of LINK large holders to exchanges currently sits at a negative value (-0.06%). This metric essentially measures the proportion of LINK whales sending their holdings to exchanges compared to the total exchange net flow. A negative value is generally interpreted as a bullish signal, implying accumulation rather than offloading.
Analysts further bolster this bullish sentiment by pointing to the Market Value to Realized Value (MVRV) ratio for LINK. This ratio suggests that the current price point might be a good buying opportunity for investors anticipating a price rebound.
Technical Analysis Hints at Potential Uptrend
While the broader market experiences consolidation, LINK’s medium-term trend appears bullish based on its ascending trendline. However, a recent correction has caused the price to dip. A crucial support level has emerged at $12.5, acting as a potential launchpad for future growth. If LINK manages to break above the overhead trendline, it could signal a continuation of the uptrend.
Also Read: Chainlink (LINK) Poised for Breakout: Analysts Predict Surge After Key Resistance Level Crushed
Analyst Opinion: LINK Poised for Rebound
Popular crypto analyst Michaël van de Poppe has highlighted Chainlink‘s resilience during bearish trends. He emphasizes LINK’s historical ability to bounce back from lows and positions it as a prime example of altcoins that recover swiftly after major corrections.
Van de Poppe’s analysis suggests a potential cyclical pattern for LINK, with significant price increases occurring in the second half of each year. He observes a similar pattern emerging in 2024, with a potential reversal following a strong downward correction in the first half.
Conclusion
The recent movements in coin holdings and price trends point towards a potential turning point for the cryptocurrency. The substantial accumulation by new whales and the reluctance of existing whales to sell indicate confidence in LINK’s future performance. This, coupled with analyst insights and historical patterns, suggests a possible bullish reversal in the latter half of 2024.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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