Chainlink (LINK) has emerged as a standout performer in the recent market rally, recording a 6% gain over the past week. At the time of writing, LINK is trading at $11.38, having successfully breached a key resistance level. With momentum building, technical indicators and on-chain metrics suggest the asset could be on the verge of a significant breakout—possibly heading towards the $13 mark or beyond.
Technical Indicators Signal a Bullish Move
LINK’s Bollinger Bands are tightening, typically a precursor to price volatility. Analysts believe this signals an imminent breakout, with the asset likely to surge past the $13 resistance level if current conditions hold. Adding to the bullish sentiment, LINK’s MACD is moving toward the positive zone, reinforcing the likelihood of upward momentum. However, a final hurdle sits at $12.82, which must be cleared for LINK to aim for new highs.
Key Drivers Fueling LINK’s Rally
- Weakening Selling Pressure
Exchange reserves for LINK have dropped by 0.26% in the last 24 hours, now sitting at 166.21 million LINK. With fewer tokens available for sale, supply constraints may trigger further price appreciation as demand builds. - Surge in Network Activity
The Chainlink network is buzzing with activity. Over the last 24 hours, active addresses increased by 1.25% to 178.91K, while transaction volume surged 1.28%, reaching 4.05K. This uptick in network participation reflects rising investor interest and signals that demand for LINK is growing steadily.Additionally, whale activity has skyrocketed, with a 293% increase in large transactions on September 25 alone. According to blockchain data, whales accumulated 8.5 million LINK (valued at $108.8 million) within a single day. Their holdings jumped from 685.5 million LINK in mid-August to 694 million LINK by late September, further bolstering bullish sentiment. - Short vs. Long Imbalance—A Potential Short Squeeze
Data shows that 53.35% of traders are currently short on LINK, compared to 46.65% holding long positions. If LINK breaches the $13 threshold, short traders may be forced to close their positions quickly, triggering a short squeeze that could catapult prices higher.
Analysts Predict a Massive Rally
Prominent crypto analyst Michael remains optimistic, suggesting that $9-$11 is an ideal entry point before LINK embarks on a rally to $35. Another analyst, ZAYK Charts, predicts a 229% surge to $40, based on LINK’s current long-term descending wedge pattern—a structure known for signaling bullish reversals.
This wedge pattern mirrors LINK’s previous cycle from late 2019 to early 2021, which saw the asset rise to its all-time high of $52.88. If history repeats itself, LINK may be approaching the apex of this pattern, setting the stage for another explosive rally.
Also Read: Chainlink (LINK) Eyes $16 Target With 11% Rally Potential – Will $12.50 Resistance Hold?
With tightening technical indicators, rising network activity, and whales showing strong accumulation, Chainlink (LINK) appears to be preparing for a major breakout. If the asset manages to breach the $13 resistance, a short squeeze could fuel rapid gains, potentially pushing LINK towards analyst targets of $35-$40.
For investors eyeing the next big opportunity, LINK might just be it—poised to reclaim its three-year high and beyond.
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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