Over the past few days, Chainlink, a notable player in the crypto market, experienced a significant price drop, reflecting the performances of Bitcoin and numerous altcoins. Chainlink’s value reached a $13.70 low on Monday, marking the lowest point since May 8th and a 23.75% drop from its high in May. Regardless of this downturn, there are three key reasons predicting that Chainlink’s price may bounce back in the coming month.
Depleting Centralized Exchange Supplies
Interestingly, the first bullish indication for Chainlink is due to the decreasing supply of LINK tokens held in centralized exchanges. Investors, preferring security, are transferring their tokens into self-custody wallets. Data collected by Santiment demonstrate a substantial drop in LINK tokens held in exchanges from 226 million in November 2023 to the current 192 million. This decline is a strong indication of growing investor confidence in Chainlink’s potential for long-term recovery.
Robust Fundamental and Strategic Partnerships
Moreover, Chainlink’s strong fundamental is another reason for investor optimism. Previous successes have seen Chainlink secure strategic partnerships with various high-profile institutions, including JPMorgan, ANZ Bank, UBS, Coinbase, Swift, and Solv Protocol. These companies have acknowledged Chainlink’s potential and are exploring ways to integrate Chainlink’s technology within the field of real-world asset tokenization. Chainlink’s Cross-Chain Interoperability Protocol has gained attention as a leading infrastructure tool for facilitating communication among different blockchain networks.
Besides, Chainlink is currently the dominant force within the realm of decentralized oracle space, securing more than $43 billion in assets across DeFi protocols. It’s closest competitor, Chronicle, secures only $7.4 billion in total value, a clear testament to Chainlink’s dominating strength.
Decrease in Whale Selling Activity
An uptime in Chainlink’s story is the recent slowdown in whale selling. As per the last check, the whale-held supply stands at 566.67 million tokens, a considerable uptick from 565.9 million last week. If this accumulation continues unchecked, it could spell the end of the selling trend that began in March and be regarded as a potential bullish signal. During this time, whale holdings touched a staggering 612 million coins high. An increase in whale accumulation would serve as a strong endorsement for Chainlink’s performance.
Increased Network Activity
Apropos growth, Chainlink’s network activity is gaining momentum with an apparent rise in the number of daily active addresses, further supporting a bullish prediction for LINK.
Chainlink’s Bullish Harmonic Pattern
From a technical perspective, Chainlink might be preparing for a significant price breakout according to a harmonic pattern emerging on its weekly chart. The XABCD pattern, a widely-accepted bullish continuation pattern, seems to be in motion.
- The XA leg unfolded between March 2024 and July 2023.
- The AB correction followed suit, running from July to November.
- The BC leg stretched from November to April 2025.
If the pattern projections hold, the CD leg is already in development, which could propel LINK to mimic its November high of $30.92. This surge would signify a 125% rise from contemporary values.
