Can Chainlink price hit $20 as new LINK ETF inflows rise?
Chainlink's price has shown a strong rebound as the market responds positively to the recent launch of a LINK exchange-traded fund (ETF) and significant inflows. On December 3, the Chainlink (LINK) token increased by 7%, reaching $14.50, which is its highest price since November 14. This rise marks a more than 25% increase from its lowest level earlier in the month.
The surge in the LINK token's price can be attributed to the Grayscale GLNK ETF, which saw over $41 million in inflows on its first day. This figure is particularly notable when compared to the Canary Hedera ETF, which has amassed $82 million since its approval in October. The strong demand for the Grayscale Chainlink Trust ETF signals a growing interest in Chainlink among investors.
In addition to Chainlink, other cryptocurrencies are also seeing inflows, albeit on a smaller scale. The spot Litecoin ETF has garnered $7.67 million, while two Dogecoin funds have attracted $2.68 million. The buoyant interest in Chainlink can be linked to its critical role within the cryptocurrency sector, providing essential oracle services to major decentralized finance (DeFi) networks such as Compound and Aave. Currently, Chainlink secures nearly $60 billion in total value across DeFi, commanding a market share exceeding 70%.
Chainlink price rebounds amid strong ETF inflows and market interest
Chainlink's recent price movements reflect a robust market sentiment. The token's performance is not just a result of the new ETF but also highlights its importance in the rapidly evolving cryptocurrency landscape.
Moreover, Chainlink is gaining traction in the burgeoning field of real-world asset tokenization, with notable companies like JPMorgan, Janus Henderson, and Swift utilizing its technology. As the demand for such applications increases, Chainlink's market position may strengthen further.
Significant inflows indicate broad market demand for LINK and DeFi
The influx of capital into the Grayscale GLNK ETF is a clear indicator of the growing appetite for Chainlink. This interest aligns with a broader trend in the cryptocurrency market, where institutional investors are increasingly looking for exposure to robust projects.
The overall interest in Chainlink is further underscored by the decrease in available tokens on exchanges. The supply of LINK on exchanges has dropped by 28% over the past six months, amounting to 217.7 million tokens. This reduction signifies a trend of accumulation among investors, as more tokens are held in private wallets rather than being traded.
Technical analysis suggests potential for $20 price target if momentum continues
From a technical perspective, Chainlink's price chart indicates a bullish outlook. The recent rebound is marked by the formation of a double bottom pattern at $11.56, with a neckline at $13.5. This suggests that the price is poised for further gains.
Additionally, Chainlink has created a large falling wedge pattern characterized by two converging trendlines. Having moved above the upper boundary of this pattern, the token is now set for further upward movement. The Average Directional Index (ADX) is currently at 32, indicating that the momentum is strong.
If Chainlink surpasses the $15 resistance level, it could pave the way for a rally toward the psychological price point of $20. However, this bullish scenario could be jeopardized if the price falls below the critical level of $11.50.
Whale accumulation and exchange supply dynamics impact Chainlink price
Another factor influencing Chainlink's price is the behavior of large holders, also known as whales. Over the last six months, whale holdings have increased by 15%, now totaling 2.92 million LINK tokens. This accumulation trend suggests that significant investors are betting on Chainlink's long-term potential.
As the supply of LINK on exchanges continues to dwindle and whale interest rises, the dynamics of the market could lead to upward price pressure. If this trend persists, Chainlink's price might not only reach but potentially exceed the $20 mark in the near future.
In conclusion, the recent developments surrounding Chainlink, particularly the strong ETF inflows and the decreasing exchange supply, present a promising outlook for the token. As market participants closely monitor these trends, the potential for significant price movement remains high.