Key Takeaways
Why is LINK under pressure this week?
Whales and retail investors are aggressively selling, driving LINK down 16.68% to $20.4 and intensifying downward momentum.
What price levels should traders watch for LINK’s next move?
LINK faces key support at $20, with a potential drop toward $18.70 if selling continues, while a daily close above $22.2 could signal a bullish reversal.
Since hitting $25 a week ago, Chainlink [LINK] has traded within a descending channel, touching a low of $19.
At press time, Chainlink was trading at $20.4, representing a 16.68% decline over the past week.
Amid this market drawdown, investors, especially whales, are panic-exiting their positions.
Whales are aggressively dumping Chainlink
Interestingly, as Chainlink continued to drop, investors, including both whales and retail traders, began panic-selling.
In fact, Chainlink’s spot market has been dominated by Sellers over the past week, as evidenced by Spot taker CVD. At press time, this metric was in red, indicating seller dominance.
Source: Cryptoquant
Amid this rising selling activity, Onchain Lens uncovered two such transactions from whales.
According to the on-chain monitor, a whale sold 233,094 LINK tokens for $4.85 million and then deposited 10k tokens into OKX.
Shortly after, another whale followed suit and sold 163,990 LINK tokens worth $3.32 million. In total, these two whales offloaded $8.17 million worth of LINK.
Typically, when whales turn to selling during a downtrend, it’s either to lock in gains or avoid further losses, a clear sign of warning market confidence.
Retail also follows suit
Notably, with large entities exiting, Chainlink’s small-scale investors have also substantially reduced their exposure.
According to Coinalyze, Chainlink recorded negative Buy Sell Delta for three consecutive days, which have coincided with price drops.
Source: Coinalyze
In fact, the altcoin saw $6.3 million in Sell Volume compared to $4.8 million in Buy volume over the past day, as of writing. As a result, it has recorded a negative Buy-Sell Delta of $1.5 million, a clear sign of aggressive spot selling.
Furthermore, exchange activities further echoed this market trend.
According to CryptoQuant data, Chainlink has recorded positive Exchange flow for three consecutive days. Netflow was 823.7k, indicating higher inflows, a clear sign of intense selling activity.
Source: CryptoQuant
Historically, when selling pressure dominates the market, an asset faces intense downward pressure, resulting in lower prices.
Can LINK hold $20 support?
According to AMBCrypto’s analysis, Chainlink has declined consistently as selling pressure from whales and retail mounts.
As a result, the altcoin’s positive Directional Movement Index (DMI) fell to 13, while its negative index jumped to 21, at press time.
At the same time, its Relative Vigor Index (RVGI) dropped to -0.24, confirming strengthening downward momentum.
Source: TradingView
Therefore, if sellers continue to dominate, LINK will most likely breach $20 and seek support around $1870.
Conversely, for a bullish reversal, LINK needs to hold above $20 and make a clear daily close around $22.2. This will strengthen the altcoin, targeting its next significant resistance at $24.49.
