In the past 24 hours, Chainlink price displayed some strength as the entire market started to rise. However, technical analysis suggests the asset is still stuck in a broader bearish pattern.
Can Traders Sustain Chainlink Price?
The disparity between Chainlink price and on-chain metrics is concerning. A deep analysis of LINK open interest (OI) and price relationship reveals bullish sentiment among traders, but on-chain metrics tell a different story—one that is bearish. According to Coinglass, LINK OI increased by 0.91% over the last 24 hours, and its price spiked by 3.88% in the same duration. When price and OI both rise, it signals that traders are opening Long positions, which is bullish for the asset’s price. However, analysis of Chainlink’s real volume on Messari Research shows that the network is struggling. LINK on-chain volume hit a monthly low of $46.1 million, with occasional spikes, such as on August 5, when the entire crypto market crashed. This suggests that while both futures and spot traders are sustaining the price, little is happening on-chain in terms of transactional operations. While this can be explained as Chainlink cornering institutional clients, the steady decline of on-chain volume is still worrying.
LINK Price Analysis: Is a 47% Crash Avoidable?
Chainlink price prediction indicates the asset is in a bearish continuation pattern known as a Bear Pennant, suggesting that LINK may continue its downtrend after a period of consolidation. If the price follows through with the Bear Pennant pattern, LINK will likely find support around the $10.49 level, but a break below this could push the price toward the next support near $9.00. Below that, a long-term support target could be set around $5.50, based on the flagpole’s projected downward height. This represents a 47% drop from the current price. All the exponential moving averages (EMAs) are sloping and expanding downward, confirming the bearish sentiment. Chainlink price is also trading below all of them, reinforcing the downtrend. The Stochastic RSI is currently in the overbought region, indicating that the asset might be due for a short-term pullback or continuation of the downtrend. The %K (RSI line) and %D (Signal line) are converging, suggesting a potential bearish crossover. If the LINK price breaks above $10.85, this could invalidate the Bear Pennant and bearish thesis. LINK would test the next major resistance at $12.04 and finally at $14.50.
Despite the overall market recovery, Chainlink continues to face downward pressure. Trader interest in long positions supports the current price, but on-chain metrics indicate weakness.
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