Recent activity surrounding Chainlink has illustrated a significant shift in market dynamics, particularly a movement towards long-term holding strategies among investors. Large withdrawals of Chainlink (LINK) from Binance have coincided with a decrease in the supply available on exchanges, easing the selling pressure in the market. Notably, a newly created wallet withdrew over 329,000 LINK, directly impacting liquid supply.
In parallel, the Chainlink Reserve has seen an increase of nearly 90,000 LINK, bringing total holdings to over 1.32 million LINK. Taken together, these developments have reduced availability on exchanges from multiple avenues. Despite these significant changes, the price of LINK has not experienced drastic fluctuations, which suggests a pattern of deliberate accumulation rather than speculative trading behavior.
This reduction in available supply on exchanges tends to lessen selling pressure during market pullbacks. As the supply of LINK tightens, sellers find themselves with diminished leverage, which complicates any attempts to pressure prices downward. Consequently, these conditions promote stability and patience in the market. Over time, consistent buy-side absorption can place upward pressure on prices, especially if demand remains strong below established resistance levels.
Chainlink’s recent trading pattern indicates it was once in a pronounced demand zone where buyers frequently intervened to maintain market stability. This intervention halted broader declines and led to price stabilization. Subsequently, LINK saw a rebound towards the descending channel resistance, typically in the $13.20 to $13.50 range. However, the price action still respects certain overhead resistance levels, with the $14.65 mark being a critical hurdle to overcome, followed by $16.66, which previously served as a distribution pivot.
Failure to maintain above the $12 level could expose LINK to renewed downside risks. Therefore, a sustained acceptance above the channel resistance is pivotal; such a shift could indicate a larger trend transition if demand continues to persist.
Market indicators back this accumulation narrative. The spot taker cumulative volume delta (CVD) over a 90-day span appears strongly positive, signifying sustained buying activity despite sideways price movements. As of now, this indicator shows a dominance of taker buy orders, indicating that market buyers may consistently absorb selling pressure. This pattern of accumulation is essential as it further supports a bullish outlook rather than suggesting a mass sell-off. The persistence of buy-side absorption beneath resistance increases the likelihood of a future breakout.
Moreover, liquidation data from derivatives markets reinforces the notion of reduced downward pressure. On December 26, short liquidations reached about $59.46k, whereas long liquidations were significantly lower at approximately $10.55k. Binance alone accounted for around $26.94k in liquidated shorts and $9.89k in long liquidations, indicating an imbalance that favored sellers. In contrast, long positions largely remained intact, pointing to market confidence rather than panic. The modest spikes in liquidation also demonstrate a controlled use of leverage, which creates an environment conducive to stability and minimizes the risk of sharp downward moves.
In summary, Chainlink currently stands at a critical juncture within a price range of $11.75 support and $14.65 resistance. The combination of significant outflows from exchanges and ongoing reserve accumulation is helping to mitigate selling pressure in the market. Price consolidation near the resistance level reflects a balance rather than weakness, with continued buying activity and liquidation data further indicating limited downside risks. As long as LINK maintains above the $11.75 mark, the risk of downside movement remains contained. A decisive breach above $14.65 could open the pathway towards $16.66, supported by favorable supply conditions that encourage additional upward momentum.
Overall, the decline in exchange supply, coupled with sustained buying pressure, suggests a potential for emerging upward movement as selling pressure continues to recede.
