Chainlink (LINK) recently reclaimed its daily trendline, with bulls defending the $12.25 support level amid mild upside momentum. Although on-chain activity has dropped sharply, fundamentals and reserves hint at potential recovery for the altcoin. The current price of LINK is at a crucial point after breaching a year-long ascending trendline, indicating a decisive moment for its short-term direction. If the $12.25 support fails to hold, downside targets at $10 and $7.50 may come into focus. Despite a recent rebound, this level has become a key battleground for bulls.
On the technical side, LINK broke above a descending trendline on the daily chart, suggesting a potential shift in trend. However, momentum remains weak, and the price could still hover around the key support area. Currently trading at $12.67, LINK needs to maintain pressure above $12.25 to confirm a sustainable reversal. New partnerships, such as the collaboration with Pi Network, aim to enhance decentralized applications through real-time data integration, strengthening Chainlink’s smart contract capabilities and potentially serving as a long-term bullish driver. However, market reaction has been muted, indicating a focus on technical structure over fundamentals in the short term.
Exchange reserve data revealed a 0.2% drop in LINK supply on exchanges over the last 24 hours, with total LINK on exchanges now at 156 million. This decline in exchange-held supply suggests a decrease in sell-side pressure, often seen during accumulation phases. If this trend continues, it could support higher prices, especially with rising demand. Investor behavior shows that whales currently control 46.1% of LINK’s supply, with their holdings decreasing by 1.41% over the past month. Retail participation has increased, with smaller market participants showing growing interest despite slight whale outflows.
Address activity indicates that traders are on the sidelines, with new addresses dropping by 44.25%, active addresses by 49.5%, and zero-balance addresses by 56.62% over the past week. This slowdown in network activity may limit LINK’s upside potential in the short term unless volume and participation increase across the market. The current setup for Chainlink suggests a market in limbo, balancing structural shifts and declining on-chain engagement. While the $12.25 level is a crucial line of defense for bulls, lower exchange reserves and positive developments like the Pi Network partnership offer support. However, fading user activity and reduced whale involvement signal caution, with a decisive bounce above current levels potentially sparking momentum, and failure to hold could lead to a deeper correction for LINK.
