Since reaching a three month peak of $8.46 on July 20, Chainlink’s (LINK) price has been declining since. As the price continues to slump, long-term holders are closing their positions, sparking fears that the LINK price rally may be over.
Chainlink (LINK) price dropped to $7.20 on Thursday, Aug 3. This represents a nearly 15% rejection from the July peak of $8.46 recorded on July 20. On-chain data reveals that long-term holders are now trading on fears that the LINK price rally may be over.
Chainlink Long-Term Holders are in Panic Mode
Chainlink has witnessed intense selling pressure from long-term holders this week. According to Santiment’s Age Consumed data, the sell-off intensified when LINK price dropped below $7.90 around July 28.
Indicatively, LINK Age Consumed has spiked from 100.73 million on July 27 to surpass 225 million on every trading day since July 30.
Age Consumed evaluates the trading activity of long-term investors by multiplying the number of recently traded tokens by the number of days since they were last moved.
As observed above, persistent spikes in Age Consumed means that long-held coins are on the move. Apparently, this sell-off among long-term holders has played a critical role in the ongoing 15% price retracement.
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Crypto Whales Have also Started to Grow Wary
Furthermore, Chainlink whales have also reduced their trading activity significantly over the past week. This echoes the bearish sentiment growing among long-term investors.
Evidently, Chainlink whales had conducted 527 Large Transactions on July 20. Over the past week, the whales have progressively tuned down their trading activity. On August 2, Chainlin saw 139 large transactions, representing a 78% drop from July 20.
The Large Transactions metric evaluates the trading activity among institutional and high-net-worth investors by aggregating the daily number of transactions that exceed $100,000.
When whales reduce their trading activity, market liquidity drops and traders often have to lower prices to fill orders.
The ongoing LINK price correction could stretch even further if the bulls cannot muster sufficient market demand to match the large investor’s sell pressure.
LINK Price Prediction: Potential Bearish Reversal Toward $6.50
According to the Global In/Out of Money Around Price (GIOM) data, the next significant supply wall that stands in LINK bears’ way is at the $6.50 support level. As shown below, 67,270 addresses had bought 561 million LINK tokens at an average price of $6.57.
But if Chainlink price drops below that support level, the LINK price rally could be over.
Still, if the long-investors decide to stop selling, the bulls could force a rebound toward $8. Although, 35,370 addresses that bought 64 million LINK tokens at the average price of $7.51 could pose significant resistance.
Nevertheless, LINK could reclaim the $8 milestone if the bulls can flip that resistance level.
Disclaimer
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