What’s Next for Chainlink (LINK) Price as Network Activity Declines?

The price of Chainlink (LINK) has been stagnant in the $11 range as bulls struggle to push the rally further. However, on-chain analysis reveals three critical metrics that could trigger a prolonged consolidation phase in the coming days.

Last week, Chainlink gained media attention as it climbed the crypto top gainers’ chart and reached a 16-month price peak. However, on-chain data shows a significant decrease in Chainlink network activity.

According to the CryptoQuant chart, Chainlink recorded its peak of 8,086 active addresses on October 23. In just 24 hours, the LINK price rose to $11.50 for the first time in a long while. However, since October 23, LINK active addresses have steadily declined, reaching 3,233 by October 29. This marks a staggering 60% drop in daily network activity within a week.

The decline in active addresses indicates a decrease in demand for the project’s services, which can be bearish for the price of Chainlink.

New Users Have Also Reduced Significantly as Network Growth Stalls

Chainlink’s price rally in the past month was driven by a surge of new users joining the ecosystem. However, recent on-chain data shows a negative turn as the number of new addresses created on the Chainlink network has significantly decreased.

According to Santiment, Chainlink network growth reached its peak of 2,465 on October 23. But similar to the trend observed in active addresses, network growth figures have also declined by 60% to hit 1,008 new addresses as of October 29.

A decline in network growth can negatively impact the price of the native token, indicating a potential slowdown in network demand.

Given the current on-chain circumstances, Chainlink’s price may struggle to find sufficient demand to continue its rally. While market sentiment is still positive, the LINK price will likely consolidate around $10 instead of retesting $15.

The exchange order books chart validates this prediction, showing that the current number of active sell orders for Chainlink exceeds market demand by approximately 1.2 million LINK.

The bulls may be able to negate this bearish narrative if they reclaim the $15 mark. However, there is a significant sell wall at the higher 5% price boundary of $11.9, which could prove challenging to overcome.

Editor Notes: A Promising Future for Chainlink

Despite the recent decline in network activity and new users, Chainlink still has significant potential. The consolidation phase may be a temporary setback, and it’s crucial to consider the broader market conditions and the evolving crypto landscape.

If you’re interested in staying updated with the latest news and trends in the crypto world, be sure to visit Uber Crypto News. It’s a reliable source for insights and analysis on cryptocurrencies, blockchain technology, and everything related to this exciting industry.

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