Chainlink has fallen out of favor in the last few months, possibly due to the parabolic run-up it enjoyed in mid 2020, but the worst may be over.
LINK’s supply ratio has been transitioning off exchanges ever since it reached a peak price of $20 in early August, on-chain market analytics firm Santiment revealed. .
This has made the firm believe that price appreciation is on the horizon since investors tend to accumulate LINK tokens off exchanges. Conversely, when tokens on exchanges increase, it’s a sign investors are getting ready to sell.
Per data from Coingecko, the maximum supply of LINK tokens is hard-capped at 1 billion, and the current circulating supply is less than half that number 400,509,556.
Is the worst over?
The token hit a high of $18.5 on Jan. 10, before plunging by +30% straight into a pivotal order block where buyers stepped back in.
Since then the fight to regain control on the direction of price discovery remains in marginally bullish territory as buyers hang on by a thread.
As covered previously, the $12 range acted as an interim buffer before price proceeded to trade between the single digit $7.57 floor and the highest daily close ($20).
Currently, the 6-hour LINK/USD pair remains in bullish territory, despite the severe correction. In the same vein, the money-flow-index – which is effectively a volume-weighted RSI – has chartered a course towards the over-sold region just over the 20 point level.
As LINK holders increase, and the $20 billion TVL level acts as an inflection point, are the LINK marines ready for another serious leg up?
The above metrics point to that direction, but whether LINK marines will seize the moment is another question entirely.