The cryptocurrency market continued to operate under fear-driven conditions, with Chainlink mirroring the prevailing risk-off sentiment. Retail participation in the market remained subdued as volatility across major altcoins decreased, resulting in LINK’s price action transitioning into a consolidation phase.
Chainlink’s Total Value Secured (TVS) reached $46.03 billion, reflecting a 2.43% increase month-over-month. This metric indicates a level of ongoing on-chain activity, despite limited price fluctuations. However, it has not signaled a clear directional shift in the market.
As of the latest updates, Chainlink was trading near the $12.5 mark, where selling pressure appeared to stabilize. Buyers managed to defend this support level, thus preventing an immediate decline into lower demand zones.
Earlier, Chainlink had broken out of a falling wedge on the daily time frame, which initially shifted the market structure from a downtrend to a consolidation phase. However, subsequent follow-through buying showed signs of being limited.
Momentum indicators indicated signs of short-term weakness. The daily MACD formed a death cross, hinting at a bearish momentum, while the Relative Strength Index (RSI) exhibited a bearish divergence, pointing to buyer exhaustion.
Whale activity was particularly pronounced on Binance, with significant withdrawals noted. On December 20th, a newly established wallet withdrew 199,520 LINK, valued at approximately $2.49 million. This transfer coincided with LINK’s sideways movement near the support level. The following day, the same wallet withdrew an additional 246,259 LINK, worth about $3.08 million, accumulating a total of 445,779 LINK after both transactions.
Exchange outflows have historically aligned with accumulation phases, as indicated by data from CryptoQuant. The recent decline in LINK supply on exchanges suggests a similar trend, contrasting sharply with periods of panic-driven deposits. Historical patterns observed from 2019–2020 indicated that such outflow behavior preceded market expansions, a trend that could potentially repeat in the 2024 cycle.
The support zone between $12 and $12.5 is crucial for Chainlink, as bulls need to maintain this area to keep the consolidation structure intact. Any failure to do so could result in a drop toward the $9–$10 demand zone. Conversely, the $27 level remains a significant resistance barrier; a successful break above this threshold could pave the way for reaching higher price ranges.
In conclusion, while Chainlink’s price action reflects a cautious market sentiment, the underlying flows suggest strategic positioning rather than outright panic. If support levels hold steady, the ongoing consolidation phase may serve as a foundation for future growth rather than a signal for a breakdown.
