Chainlink Against the Current, Why Analysts Predict Further Gains

The cryptocurrency market experienced a correction in late May 2024, with many prominent digital assets like Bitcoin experiencing price drops. However, Chainlink (LINK) emerged as a prominent gainer, increasing nearly 6% in a single day and reaching close to $19. This impressive performance has led to optimism among analysts, who predict further price increases for LINK in the coming months.

Analyst Insights

To understand the bullish sentiment surrounding Chainlink, here is a look into the specific points raised by analysts:

Market cycle stages and the “Hope” phase

Analyst FLASH uses a technical analysis tool called a macro chart. This chart outlines the different stages that a token’s price usually goes through within a market cycle. Based on this framework, FLASH believes LINK is presently in the hope phase. This suggests a period of rising optimism and possible price gains. They even predict a peak of $24 in the coming days, exceeding the token’s previous highs from 2020.

Key partnerships driving growth

Analyst Zach Rynes emphasizes Chainlink’s recent strategic partnerships as a major driver of future success. He argues that Chainlink will continue to grow well due to its deep integration with the traditional financial system. This is evidenced by collaborations like the Smart NAV pilot with the DTCC ( Depository Trust and Clearing Corporation), a leading US financial service company. This pilot program may bridge the gap between traditional finance and blockchain technology and create significant new use cases for Chainlink.

On-Chain Metrics- Numbers Don’t Lie

Besides analyst opinions, on-chain metrics associated with Chainlink’s ecosystem also provide valuable insights into likely price movements.

Increased whale activity

Data from IntoTheBlock, a blockchain analytics platform, reveals a significant rise (130%) in daily transactions volume exceeding $100,000 for LINK. This substantial increase in large-scale transactions, often attributed to whales, suggests growing investor confidence in LINK. This confidence could lead to further investment and drive the price up.

Shift from exchanges to self-custody

Another bullish indicator is the negative exchange netflow observed for LINK in the past week. This indicates a movement of LINK tokens from centralized cryptocurrency exchanges to self-custody wallets. This trend decreases the instant selling pressure on exchanges, leading to price appreciation.

Is Chainlink a Potential Leader for Altcoins?

The strong performance of Chainlink in May has not gone unnoticed by the broader market. Market observers are closely monitoring LINK’s movement, believing it could offer valuable insights into the health of the altcoin market.

Analyst Michael Van de Poppe highlights LINK’s potential as a leading indicator for altcoins. He suggests that if LINK can maintain its price above $16, it could trigger a bullish rally for the entire altcoin sector. This means that other altcoins might experience price increases as well, mirroring LINK’s positive momentum.

The recent approval of Ethereum ETFs is another factor that could influence Chainlink’s price. While the full impact of these ETFs remains to be seen, a likely rise in Ethereum’s value could have a positive spillover effect on LINK, considering that Chainlink relies on the Ethereum network for its core functionality.

Joas Buysse

Joas is a seasoned investor and fintech expert from Bassecourt, Jura, Switzerland. She also works as an administration executive at Stock B. Joas has been working with SB news since 2 years to educate its readers about NFT, Cryptocurrency and Fintech tips.

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