Key Takeaways
Chainlink saw rising New and Active Addresses as NVTS returned to November 2024 levels; the 4-hour chart favored bulls above $24.3 to $25, with $29.26 next.
Chainlink [LINK] rose throughout August.
Despite the volatility around Bitcoin [BTC], LINK bulls have managed to perform relatively well, making 38.6% gains in the past 30 days.
On-chain heat builds
The bullish sentiment explained the uptick in on-chain activity.
Using Glassnode data, AMBCrypto found that the New Addresses count has been trending higher since June. At press time, it was at 2,163, roughly in line withNovember 2024.
Like the new address count, the Active Addresses metric was also trending higher. It, too, was nearing the levels from November 2021.
Together, the network activity was a heartening sign to long-term holders and investors.
At first glance, it might also seem like a warning signal. However, if historical data should be repeated, then the Chainlink rally likely has a long way to go.
That does not mean such a rally is guaranteed, but rather that it is a likely possibility.
On top of that, further gains for Bitcoin and Ethereum [ETH] could funnel flows into LINK.
What other signs could Chainlink appreciate?
The Network Value to Transactions ratio compares the market cap of an asset to its daily transaction volume.
A low NVT implies the asset is relatively undervalued compared to its utility. The NVT Signal modifies the metric, using a long-term (such as 90-day) moving average of the daily transaction volume.
The NVTS for LINK was at levels it had been at in early November 2024, when the LINK rally from $10.56 to $29.26 began. In fact, this was one of the reasons why the claim that Chainlink could rally higher holds water.
LINK chart holds support
Source: LINK/USDT on TradingView
To understand where LINK could go in the coming days, the 4-hour chart was examined.
The $24.88 and $29.26 were key horizontal levels on the weekly timeframe, making them important support/resistance levels on the 4-hour chart as well.
At press time, the Chainlink token was trading inside a rising channel (purple). It was above the $24.88 former resistance, and about to retest the same as support.
The moving averages and Awesome Oscillator and A/D indicator all backed buyers. If the $24.3–$25 demand zone held, a rally toward channel highs looked likely.
