Chainlink’s LINK token witnessed a significant surge of 7% on January 17th, reaching a price of $16. This level was last observed on December 29th, 2023, and it further established LINK as the 11th largest cryptocurrency, excluding stablecoins, in terms of market capitalization.
It is noteworthy that while LINK experienced this increase in value, Bitcoin’s price declined by 2% during the same period. Additionally, LINK’s performance stands out when compared to a 0.65% decrease in Ether’s value and a 5.5% increase in SOL’s value.
Upon reviewing Chainlink’s news and roadmap, it becomes evident that the project’s oracle and decentralized computing solutions are driven by the anticipation of real-world asset (RWA) tokenization and signs of institutional adoption.
However, the question remains: can LINK sustain this current rally? Let’s delve into this further.
The upward trajectory of LINK is backed by various partnerships and collaborations established by Chainlink. Notably, the announcement of partnerships between Chainlink Labs and SingularityDAO, a decentralized platform, as well as Swift, has significantly supported LINK’s presence in the RWA sector for several months. These collaborations have contributed to the bullish sentiment surrounding LINK.
Furthermore, the recent integration of Chainlink CCIP by Redacted for cross-chain transfers of Pirex ETH (pxETH) highlights Chainlink’s growing influence in the Web3 space. The integration aims to enhance cross-chain interoperability, making pxETH accessible across multiple blockchains.
Another factor contributing to Chainlink’s recent surge is the decreasing supply of LINK on exchanges. Data tracking LINK supply across crypto exchanges reveals that it has reached a four-year low, falling below 15%. This diminishing supply suggests that traders prefer holding LINK tokens rather than selling them for other assets. Therefore, if the demand for LINK remains strong, its potential for continued growth increases.
Additionally, there has been a 6% increase in the number of wallets holding more than 0 LINK, nearing its all-time high at 713,560. This indicates that smallholders of Chainlink may believe in its future value appreciation.
Analyzing LINK’s price action since December 27th, 2023, it is evident that a V-shaped recovery chart pattern has formed on the daily chart. A V-shaped recovery is a bullish pattern characterized by a sharp price increase following a steep decline. The pattern is considered complete when the price reaches the resistance level at the top of the V formation. Currently, LINK is trading near the pattern’s resistance line at $17, suggesting a potential continuation of the bullish trend.
Furthermore, the rising moving averages and the positive moving average convergence divergence (MACD) indicator provide further evidence of the bullish momentum building in LINK’s price. The MACD’s bullish cross, observed on January 14th when the 12-day exponential moving average (EMA) crossed above the 26-day EMA, indicates that market conditions continue to favor the upside.
In conclusion, Chainlink’s LINK token experienced a significant surge, solidifying its position as the 11th largest cryptocurrency by market capitalization. However, it is important to note that this article does not provide investment advice or recommendations. Readers are advised to conduct their own research and assessment before making any investment or trading decisions.