Chainlink (LINK) is facing a challenging time in the cryptocurrency market as it shows signs of a potential price decline. The bearish sentiment surrounding LINK is evident in its recent price action pattern on the daily time frame, signaling a downward trend. Moreover, the overall market sentiment for major cryptocurrencies has also been on the decline, further impacting LINK’s price.
As of the latest update, LINK is trading around the $10.52 level, experiencing a 2.7% price drop in the past 24 hours. The decrease in trading volume by 19% suggests a reduced participation from traders and investors, likely due to the bearish price action pattern observed in LINK.
Technical analysis experts have identified a bearish head-and-shoulder pattern on LINK’s daily chart. The recent price drop has led to a break below a crucial descending trendline support that has been in place since August 2024. This development indicates a potential further decline in LINK’s price in the near future.
If LINK breaches the neckline of the bearish pattern and closes below the $10.30 level, there is a high likelihood of a 13% price decline, potentially reaching $9. Traders and investors are closely monitoring LINK’s movement below the 200 Exponential Moving Average (EMA), signaling a downtrend that could persist.
On-chain metrics from Coinglass further support the bearish outlook for LINK. The Long/Short ratio currently stands at 0.82, indicating a strong bearish sentiment among traders. Additionally, the increase in future open interest by 5.2% over the past 24 hours suggests a bearish stance among LINK holders.
With 54.84% of top traders holding short positions and 45.16% holding long positions, it is evident that traders are increasingly betting on the short side, anticipating a further price decline. This shift in sentiment highlights the cautious approach of traders towards LINK’s future price movement.
In conclusion, the current market conditions and technical indicators point towards a potential price decline for Chainlink (LINK). Traders and investors are advised to closely monitor the price action and on-chain metrics to make informed decisions regarding their positions in LINK.