Chainlink’s LINK token saw a significant surge of 7% on January 17th, reaching a price of $16. This price level had not been seen since December 29, 2023, and it further solidified LINK’s position as the 11th largest cryptocurrency (excluding stablecoins) based on market capitalization.
It is interesting to note that while LINK has been gaining value, Bitcoin’s price has been trading 2% lower during the same period. Additionally, LINK’s performance stands out when compared to Ether’s 0.65% decrease and SOL’s 5.5% increase.
Upon examining Chainlink’s partnerships and collaborations, it becomes evident that the project’s oracle and decentralized computing solutions are driven by the anticipation of real-world asset (RWA) tokenization and signs of institutional adoption. These factors have contributed to LINK’s outperformance compared to its peers.
Notably, Chainlink Labs’ recent partnerships with SingularityDAO, a decentralized platform, and Swift have supported LINK’s presence in the RWA sector for several months, bolstering its bullishness. Furthermore, Redacted’s integration of Chainlink CCIP for cross-chain transfers of Pirex ETH (pxETH) highlights Chainlink’s growing influence in the Web3 space. This integration aims to enable the accessibility of pxETH across various blockchains for cross-chain interoperability.
Another factor that could explain Chainlink’s recent upside is the decrease in LINK supply on exchanges. Data shows that LINK’s supply on exchanges has reached a four-year low, falling below 15%. This diminishing supply suggests that traders prefer holding LINK tokens rather than selling them for other assets. As long as demand remains strong, LINK’s potential to sustain its current rally increases.
Moreover, there has been a 6% increase in the number of wallets holding more than 0 LINK, approaching its all-time high at 713,560. This indicates that Chainlink’s smaller holders believe in the token’s potential for further value appreciation in the near future.
In terms of price action, LINK has formed a V-shaped recovery chart pattern on the daily chart since December 27, 2023. A V-shaped recovery is a bullish pattern characterized by a sharp price increase following a steep decline. Currently, LINK is trading near the resistance line of this pattern at $17, suggesting a potential continuation of the upward trend.
The rising moving averages and the positive moving average convergence divergence (MACD) indicator further support the bullish momentum building in the LINK price. The MACD’s bullish cross on January 14, when the 12-day exponential moving average (EMA) crossed above the 26-day EMA, indicates that market conditions continue to favor the upside for LINK.
It’s important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and analysis before making any investment or trading decisions.