Chainlink’s on-chain and price performance suggests that asset could be ready for reversal
Chainlink showed some signs of potential upwards volatility appearing on the market in the foreseeable future, according to Santiment analysis, despite being up over 40% since July 1.
Dormant LINK showing big move
One of the main indicators that might be telling us that something’s up with Chainlink is the movement of dormant coins on-chain. At the end of July, Chainlink investors moved a massive number of coins to cold wallets, which is a positive sign for any cryptocurrency, as it usually means that spending on the chain is decreasing.
📈🔗 #Chainlink had several indications that early July was setting up to be an opportune #buy time (+41% since July 1), with a rising triple bottom as a nice signal. Additionally, dormant $LINK saw a big move, and coins have moved into cold wallets since. https://t.co/k8owTq9OSA pic.twitter.com/cJtmLJOnsZ
— Santiment (@santimentfeed) August 8, 2022
With coins sitting on cold wallets, investors are more likely to avoid any operations with cryptocurrency during market fluctuations, as it would require a transition of funds to centralized exchanges and additional spending on a heavily loaded network.
Supply on exchanges is dropping
The supply on exchanges is another fundamental indicator that shows the intention of traders on the market in general. According to the metric, the majority of market participants are currently not feeling like selling their holdings, which is why the supply on centralized exchanges is migrating towards cold wallets.
According to the metric, only 18% of the coin’s supply remains on centralized exchanges, which is a relatively low number that indicates a lack of selling pressure on the cryptocurrency.
As for the price performance of the asset, LINK manages to outperform the most digital assets on the market with more than a 30% price increase in the last few weeks and successful movement through local resistance levels.
At press time, Link is changing hands at $8.5 and shows a 1.5% price increase in the last 24 hours.