Rally Over Or Is There More To Go?
The Chainlink rally has slowed recently; here is what the different on-chain LINK metrics look like to see if the surge has any hope of a restart.
Chainlink has seen some decline over the past 24 hours
Just over the weekend, Chainlink was hovering above the $16 mark, but the tide appears to have changed for the coin over the past couple of days as it saw some decline.
In the last 24 hours alone, LINK fell by around 6%, causing its price to drop below the $14 level. The chart below shows the cryptocurrency’s performance over the past month.
LINK appears to have gone down in the last two days | Source: LINKUSD on TradingView
As noted above, Chainlink had rolled a few strong upward momentum in this period preceding this latest fall, because the value of the asset had more than doubled. Despite the decline, LINK is still up over 90% over the past month, which is an impressive return.
Naturally, investors may now be wondering if the asset has already peaked for this rally or if there will be more to come soon. It’s hard to say anything about this, but perhaps on-chain data could provide some clues.
LINK activity has been relatively high recently
In a new job On X, market intelligence platform IntoTheBlock shared data from some on-chain Chainlink indicators. First, when the company released this message, approximately 56% of investors in the asset were making profits.
Looks like 39% of the holders had been underwater | Source: IntoTheBlock on X
The cryptocurrency was then floating at higher levels than currently (although not too high), so more LINK addresses would now have entered a state of loss.
Typically, take-profit investors are more likely to sell at any time, so a large number of them being in the green could increase the likelihood of a selloff. Some Chainlink investors are currently reaping their profits, but the profitability ratio is still not so profit-oriented.
Next, IntoTheBlock talked about number of transactions on the network.
The value of the metric seems to have been going up recently | Source: IntoTheBlock on X
“The Chainlink network is showing many positive signs in terms of transaction data,” says the intelligence platform. “In particular, we are seeing a healthy increase in the number of transactions. »
The number of transactions increased by 436% from monthly lows and, as is usually the case, volume also increased alongside this increase.
LINK volume hit $515 million last week | Source: IntoTheBlock on X
The high trading activity suggests that there is interest behind the asset, and therefore, the price action is not expected to subside yet. However, the volatility due to this activity can go either way, as the asset is already witnessing.
One metric that could more clearly point a direction for the cryptocurrency is the large holder. net flowwhich tracks net accumulation/distribution behavior over the past month for LINK holders holding more than 1% of the supply.
The metric's value has been positive recently | Source: IntoTheBlock on X
As the chart shows, large holders of Chainlink have been buying recently, which could potentially be a positive sign for the asset. Of course, this doesn’t necessarily mean the rally will resume anytime soon, but it does provide some support for the idea.
Featured image from Shutterstock.com, charts from TradingView.com, IntoTheBlock.com
