Is Chainlink (LINK) about to witness a 40% price breakthrough?

Will Chainlink (LINK) surge by 40% soon?

Author: Ibrahim Ajibade, BeinCrypto Translation: Shanooba, LianGuai

Abstract

• Despite the prevailing negative sentiment in the altcoin market, Chainlink (LINK) price saw an 8% rebound on Wednesday, August 23rd.

• Although it is currently unclear what the fundamental driving factors behind this rebound are, the resilience shown by long-term investors in recent times seems to have played a significant role.

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• MVRV data shows that most long-term investors still have double-digit losses.

Despite the widespread FUD in the altcoin market, Chainlink (LINK) price rebounded by 8% on Wednesday, August 23rd. Will investors continue to wait for a price breakthrough to avoid double-digit losses?

On August 23rd, Chainlink (LINK) price saw a rare 8% increase. On-chain analysis examines whether LINK is on the edge of a price breakthrough or if bears could potentially reverse the gains in the coming days.

Long-term investors remain steadfast

The milestone partnerships and network integrations recently announced by the Chainlink team appear to have sparked confidence among long-term investors. It is worth noting that after the significant volatility seen last week, the average coin age for LINK dropped to 35.70. However, as of August 23rd, it has reached 40.3, an increase of 13%.

The average coin age data is an important metric for measuring the overall sentiment of long-term investors. It is derived by estimating the average number of days tokens have spent in their current wallet addresses in circulation.

An upward trend in average coin age indicates a positive attitude from long-term investors towards the Chainlink network. If they continue to hold, Chainlink (LINK) may enter a sustained price breakthrough.

The current price remains unfavorable for most holders

Despite the significant 8% price increase on August 23rd, most LINK holders would incur double-digit losses if they were to sell immediately. As shown in the MVRV chart below, the majority of cryptocurrency investors who purchased LINK in the past 30 days hold unrealized losses of 14%.

The Market Value to Realized Value (MVRV) ratio analyzes the net financial condition of holders. The chart above shows that most holders who purchased LINK in the past 30 days would suffer heavy losses if they sell early.

Therefore, LINK traders can hold on until the price breaks through $7 to avoid double-digit percentage losses.

LINK Price Prediction: Possible retest of $10

Considering the on-chain metrics mentioned above, Chainlink bulls may push for a sustained price breakthrough to $10.

The inflow/outflow data around the price describes the distribution of buying prices among current investors in the Chainlink ecosystem. It emphasizes that the initial resistance for the LINK price will be around $7.

As shown in the chart below, 22,560 holders bought 273.5 million LINK at a maximum price of $6.80. If Chainlink takes profits early, its price may enter a bearish reversal. However, if the bulls can break through this resistance level, the LINK price may surpass $10.

If the LINK price falls below $6, the bears may invalidate the price prediction. Although 18,570 addresses bought 240.4 million LINK at an average price of $6.25. If Chainlink holders continue to hold on instead of selling as expected, the price breakthrough may continue. But if this support level drops, the LINK price may fall to $5.

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