Chainlink (LINK) Price Puts $12 Million Short Contracts at Risk

As Chainlink (LINK) fluctuates within the $13 to $14 range, traders seek hidden insights into potential price trends. Recent events have prompted market participants to exercise greater caution.

However, the 7.72% price increase in the past 24 hours may alter prevailing perceptions. Considering the possibility of an upward movement, let’s delve into on-chain data and its implications.

Chainlink Traders Take Note

BeIn Crypto analyzes Chainlink’s liquidation chart to understand how further upward trends might impact LINK traders.

• Liquidation Chart: This chart examines past price trends to identify potential levels of liquidation risk.
• At the time of writing, LINK is trading at $13.94, having risen 6.93% in the last 24 hours. With increasing trading volume, the cryptocurrency’s value could reach $15.

According to Coinglass, if Chainlink’s price reaches $15.62, cumulative short liquidation leverage would be $12.56 million. From a non-technical perspective, traders betting on LINK’s price decline with insufficient margin balances would face losses if this prediction holds true.

!Chainlink Liquidation Chart{: style=“max-width: 100%;”}

Conversely, if LINK drops to $12.18, positions worth $10.99 million would be liquidated. However, data from IntoTheBlock suggests that the likelihood of reaching the $12 range is low based on bullish and bearish indicators.

• Longs vs. Shorts Indicator: This metric measures the number of addresses buying or selling more than 1% of the total trading volume. Addresses buying over 1% are longs, while those selling are shorts.
• Over the past seven days, shorts have outnumbered longs. This contributed to LINK’s decline to $12.91 on June 24.

!Chainlink Bullish and Bearish Indicators{: style=“max-width: 100%;”}

However, as of now, longs have gained the upper hand. If this momentum persists, LINK may resist downward pressure and continue its ascent.

LINK Price Prediction: Potential Upside

From a technical standpoint, we observe that LINK has formed a double bottom pattern. Such patterns often indicate reversals and, in many cases, mark the beginning of potential upward trends.

When prices touch a support level twice, it signals a pause in the asset’s downtrend. On the daily chart, LINK exhibited a similar pattern between November 2023 and January 2024.

Between January 26 and February 13, LINK’s price surged from $13.82 to $20.50. Based on this historical performance, the cryptocurrency could start an upward move and reach $14.73 in the coming days. If validated, LINK’s price might climb to $17.73 within a few weeks.

!Chainlink Daily Analysis{: style=“max-width: 100%;”}

Meanwhile, the Relative Strength Index (RSI), which measures momentum, is recovering from oversold conditions.

An RSI reading below 30 indicates oversold conditions, while above 70 suggests overbought levels. As of writing, the RSI stands at 39.63, indicating that the potential move to $15 hasn’t been confirmed yet.

!Chainlink Relative Strength Index{: style=“max-width: 100%;”}

However, if the RSI crosses the neutral zone around 50.00, LINK could achieve the aforementioned price or trade higher. But if bearish forces prevail, the prediction may fail.

Bitcoin (BTC) as a Factor

Another potential hindrance to the uptrend is Bitcoin (BTC). A few days ago, BTC faced selling pressure, resulting in a market downturn.

As of now, Arkham Intelligence reports that the German government is transferring a new batch of BTC to exchanges. If these sell-offs continue, prices of altcoins, including LINK, may cease their ascent, and the next move for LINK could dip below $12.80.

Disclaimer: This price analysis article serves as reference only and should not be construed as financial or investment advice. Before making any financial decisions, please conduct your own research and consult professionals.

Sentiment: Positive