Chainlink (LINK) Faces Selling Pressure as 13% Supply Turns Profitable

6 months ago 1

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Chainlink’s (LINK) price felt the bullishness of the Bitcoin halving event more than BTC itself, which was visible in its 20% rally.

The altcoin, however, is now facing a crucial barrier, which has been a challenge in the past.

Chainlink Investors Might Move to Sell

As Chainlink’s price rose, LINK investors regained their profits, which might be a key factor driving them to sell. The recent correction brought the total LINK supply in profit down from 84% to 70%.

This 14% supply represents nearly 82.18 million LINK worth nearly $1.3 billion. All of this supply has once again returned to its original state before the decline. In the past two days, the profitable supply rose by 13% to reach 84% at the time of writing.

While this is a good thing, it is also a potential trigger for selling, as investors want to secure their gains to prevent losses from another decline. This would drive Chainlink’s price lower.

The Market Value substantiates this sentiment to the Realized Value (MVRV) ratio. The MVRV ratio tracks investor gains/losses. Chainlink’s 7-day MVRV of 11% suggests profit, possibly prompting sales. Historically, BTC corrects at MVRV levels of 8% to 15%, labeling it a danger zone.

In the short-term timeframe, this area has repeatedly witnessed declines, which is the expected outcome for LINK.

LINK Price Prediction: Beating the Barrier

Chainlink’s price was noted to rally by 20% over the weekend, bringing the digital asset to trade at $15.8. Right under this point is a barrier that LINK has attempted to sustain multiple times and failed in the past.

Even though The altcoin manages to close above it, it falls back down from the $15.6 resistance to test the support at $14.6 and $13.4. If LINK holders move to sell this time, the potential decline will result in a test of the latter support level should the former break.

However, if the resistance of $15.6 is successfully breached and flipped into support, recovery is possible.

The next critical resistance lies at $18, and Chainlink’s price would make it there should it breach $17. Once the latter is flipped into support, the altcoin would invalidate the bearish thesis and rally towards $18.

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