Chainlink’s (LINK) price might be ready for another climb as another round of its non-circulating supply hits the market, Lookonchain disclosed. According to the on-chain tracking platform, 15.95 million LINK was sent into Binance.
This transaction is something Chainlink does every three months, and a total of 95.95 million tokens have been sent since August 2022. Lookonchain also noted that each time this transfer happens, LINK’s price usually increases.
Chainlink Noncirculating Supply wallets deposited 15.95M $LINK($283M) to #Binance again 7 hrs ago.
The wallets deposited $LINK to #Binance every 3 months since Aug 26, 2022, with a total of 95.95M $LINK($1.7B).
And most of the time the price will increase after the deposit. pic.twitter.com/UefqAU8Vpi
— Lookonchain (@lookonchain) February 3, 2024
LINK Got Overbought
At press time, LINK’s price was $17.73, representing a 25.59% increase in the last seven days. Furthermore, a look through CoinMarketCap showed that LINK was the highest out of all the top altcoins within the aforementioned period.
As of this writing, the 4-hour LINK/USD chart showed that the token had attempted to hit $19 earlier. But it was followed by a quick rejection which triggered a drop from $18.86. Meanwhile, hitting $18.86 meant that LINK hit its highest value in the last 22 months.
Details from the chart below also showed that LINK’s trading volume was high. Should the volume remain at a similar peak, the price action might try and retest $18 for a start.
An assessment of the Relative Strength Index (RSI) showed that the reading hit 80.81 on February 2. This earlier hike implied that LINK was overbought, after which the RSI declined.
The decline in the RSI and profit-taking seemed responsible for the LINK’s retracement. Should the reading fall below 60.00, LINK’s price might also continue in the downward direction. If profit-taking continues, there is a chance the token value might fall below $15.
New Entries and a Surging Interest
Also, indications from the Fibonacci retracement showed that the possible decline could offer another buying opportunity around $14.78. This was because the 0.618 Fib level was positioned at this price.
LINK/USD 4-Hour Chart (Source: TradingView)
In a highly bearish case, LINK’s price might hit the 0.618 Fib retracement level. However, if the price recovers before then, LINK might hit $20 in a few weeks.
On the derivatives end of the market, Coinglass showed that LINK’s Open Interest jumped to $364.11 million. Open Interest is the sum of all open positions in a contract, and it increases or decreases based on net positioning.
If the Open Interest decreases, it means that there are more aggressive sellers than buyers. However, an increasing Open Interest indicates a surge in aggressive buyers. In LINK’s case, the large Open Interest might help the price break through the resistance.
LINK Open Interest (Source: Coinglass)
Should this be the case, LINK might jump toward $19.50, and if the momentum is very bullish, a move in the $20 direction could be validated.
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