- LINK has seen huge declines, which could cause a trend reversal.
- Price chart analysis supports a trend reversal scenario, but interest in whales has been mixed.
The negative market sentiment has lingered Chain link [LINK] to short- and long-term trend lows, meaning huge discounts for the altcoin. According to Santiment factsthe price drops justify taking the discount.
“Historically, the more ‘blood on the streets’ there is from other traffickers, the more justification there is for buying into the pain of others.”
Source: Santiment
The Santiment analysis was based on the MVRV (Market Value to Realized Value) metric, which measures the token’s valuation. A negative value suggests that a token is undervalued and is a great buy.
However, a positive value indicates that a token is overpriced and may prompt holders to sell for a profit.
For LINK, the MVRV ratio decreased by 11% and 18.7% on a monthly and annual basis. That means LINK was in a great buying position for short- and long-term investors.
Does the price chart position also support a buying idea for LINK?
LINK price analysis
Source: LINK/USDT, TradingView
LINK rose 87% in early 2024, rising from $12 to $22, a return of about 1.8x for those who held it in the first three months of the year.
However, in the second quarter everything was erased and an attempted recovery also resulted in losses. At the time of writing, LINK was trading at $11.59 and on track to hit its June low of $11.05.
The $11 level has been a key demand zone all year. In short, LINK was a crucial demand zone that supported Santiment’s thesis. It could be great for swing traders looking to go long.
If market sentiment improves, the immediate bullish target above $14 would yield a 30% return.
However, continued weak sentiment could push LINK below $10 and add to the market carnage.
Whale interest in LINK
Interestingly, a whale cohort went long at the current low and demand level.
Addresses with between 1 and 10 million LINK (blue) have been piling up since late July and sparked a buying wave in August. They now own 19% of the LINK offering.
Source: Santiment
However, the current selling pressure appears to be coming from addresses with 10,000 to 100,000 coins and 100,000 to 1 million coins. Collectively, these two groups control about 20% of the LINK offering, almost comparable to the cohort that is gathering.
To follow Bitcoins [BTC] The next direction could determine whether LINK will bounce out of the $11 demand zone.