Monday, March 4, 2024

Chainlink Price Slump Expected to Extend as $500 Million LINK Nears Profit-Zone.

A sizable portion of the altcoin’s rally since the start of the month has been erased by the price of Chainlink. Given that investors are more likely than ever to book profits, which could result in further drawdowns, the next leg of the price action is probably going to continue this decline.

Chainlink’s price continues to drop.

As of this writing, the price of Chainlink is trading at $14.32, down roughly 19% over the previous ten days. As a result, it is in danger of losing the $14.00 support line and the $15.00 support line.

The bearish crossover that was observed more than a week ago is still present in the Moving Average Convergence Divergence (MACD) indicator. The histogram’s receding red bars do indicate waning bearishness, but going forward, this is anticipated to get more intense.

LINK could end up falling toward $13.00 or lower if it is unable to solidify $14.00 as a support line, wiping out almost half of the gains recorded over the previous month.

On the other hand, the bearish thesis would be refuted if the steady rise persists and the Chainlink price breaks above the $15 resistance level. Additionally, this would encourage LINK to rise above $16.50 and set new highs for the year.

Chainlink holders might be a factor in the decline in price.
Given that the price of Chainlink is steadily dropping and endangering the profits investors have made over the last month, this may not be what they want. This is especially true for those investors who purchased LINK at the current price. Potential immediate results are displayed by the In/Out of the Money Around Price (IOMAP) indicator, which calculates the profitability of supply purchased for less than 15% of the asking price.

According to the indicator, if Chainlink’s price drops below the acquisition price of $14.08, approximately 34.97 million LINK, valued at over $500 million, will soon cease to be profitable. It is likely that LINK holders will decide to sell their holdings in order to offset their losses and make sure that this doesn’t happen.

The Market Value to Realized Value Ratio (MVRV) also lends credence to this theory. An indicator used to evaluate the average profit or loss of investors buying an asset is the MVRV ratio. The average profit or loss for investors who purchased the asset within the last month is determined by the 30-day MVRV ratio.

Chainlink’s 30-day mean return on invested capital (MVRV) is 18%, meaning that investors who bought LINK within the last month are profiting by 18%. In order to realize profits, these investors will probably sell their holdings, which could lead to a sell-off.

Profit booking would therefore cause the current decline to continue.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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