Whales continue to accumulate Chainlink (LINK) as the price of coin lingers just above 2023 October levels. A reciprocation of the 2023 pattern will see the coin rise above $20.
LINK trades in tight range since February
Chainlink (LINK) has been moving lethargically since February. The geopolitical tensions in the Middle East made the investors practice precaution and stay away from the risk assets.
With no demand, the coin has been moving sideways in a tight range between $8-$10. Whales spotted LINK bottoming and started to accumulate the coin.
According to Santiment, an analytical tool, there are now about 25.5K wallets that hold at least 1,000 Chainlink tokens. This is the highest amount since Dec. 4th, and it comes at a time when $LINK has been trading in the range of $9 to $10 since early February.
When whales are accumulating LINK, it means that large holders are buying and holding significant amounts of Chainlink tokens.For other traders, whale activity serves as a market sentiment indicator. Oftentimes when retailers see whales buying, they too start accumulating, and this attracts additional buying interest as they see it as a bullish signal.
And when whales move them into wallets, it shows they have no intention of selling in the near future. This behavior generally goes on to show the confidence in the asset, as these investors expect the price to rise or see long-term value in LINK.
Accumulation by whales also reduces the circulating supply on exchanges, which can create upward price pressure if demand remains steady.
However, while accumulation is typically seen as positive, it also introduces potential volatility, because if whales decide to sell suddenly, it can trigger sharp price swings. Overall, whale accumulation reflects growing interest and cautious optimism in the market.
Bullish momentum builds as LINK nears breakout
On the 1-day chart above, LINK is trading inside the falling wedge. After about 7 months of trading inside the wedge, the token is now at its apex. This means that the breakout is near. When a falling form and breakout occur, the price of the token has a surge, which is equivalent to the height of the wedge at its widest point. Although LINK has not broken out, there are signs that the bullish momentum is building behind the scenes.
For instance, the relative strength index indicator is making higher lows while the prices are moving sideways. This shows the bullish momentum buildup. With the bullish momentum building, the breakout could happen at any given point. And given that LINK reciprocates the 2023 rally, the token could go past $20 easily.
