Chainlink Price Under Scrutiny Amidst New Developments
Chainlink’s price remains a central focus in the crypto market as the decentralized finance (DeFi) leader extends its influence into the traditional finance (TradFi) sector. The latest noteworthy addition to Chainlink’s roster of data oracle users is Superstate, an asset management fund managing over $103 million in assets. Despite this significant development, the LINK price fails to mirror these fundamental advancements, with a bearish pattern potentially pulling the price back to $8.00.
On-Chain Metrics Signal Possible Sell-Off
On August 12, Chainlink announced a strategic partnership with Superstate, a firm specializing in tokenized financial products. This collaboration will see Superstate integrate Chainlink’s Price Data Feeds into its tokenized treasury fund, the Superstate Short Duration US Government Securities Fund (USTB), facilitating on-chain tracking of its net asset value.
Although this partnership is a positive step for Chainlink, investor sentiment appears to be wavering. On-chain data points to potential sell-off signals. According to IntoTheBlock, large LINK holders are experiencing a net outflow of 17%. Over the past week, large holders have reduced inflows by 84% and outflows by 67%, indicating a trend of LINK tokens exiting their wallets, which could imply impending selling.
Furthermore, CryptoQuant data shows a slight increase in Chainlink’s exchange inflows over the past 24 hours, suggesting that investors might be preparing to sell.
As a result, Chainlink’s price has decreased by 4.1% in the last 24 hours, now trading at $10.19. Technical analysis indicates that LINK investors should brace for the possibility of further declines in the near future.
Chainlink Price Faces Potential Pressure
Chainlink is currently in a bearish trend, trading below both the 50-day EMA (at $10.94) and the 200-day EMA (at $12.72). A bearish rising wedge pattern has formed and broken to the downside. The LINK price is now testing the lower boundary of this wedge, with potential for further downward movement.
Key support and resistance levels for LINK are:
- Resistance 1: The 50 EMA at $10.94
- Resistance 2: The 200 EMA at $12.72
- Support 1: The lower boundary of the rising wedge, currently being tested
- Support 2: Approximately $8.00
The price has shown signs of breaking down from this pattern. If confirmed by volume and price action, this could lead to additional declines.
The Relative Strength Index (RSI) is currently at 46.56, below the neutral 50 level, indicating potential for further downside before reaching oversold conditions. The Chaikin Money Flow (CMF) is slightly positive at 0.14, suggesting a modest capital inflow, though not sufficient to counteract the bearish momentum.
Overall, the bearish rising wedge pattern suggests a potential downside move for LINK. However, a rise above the 50-day EMA could signal market strength, invalidating the current bearish outlook and potentially pushing the LINK price towards $12.72, with a possibility of revisiting $15.
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