Chainlink‘s [LINK] on-chain metrics have remained undeterred during the latest market-wide rout that captured yet again as the weekend dawned. While several top assets are still struggling with the bearish impetus, the LINK token, on the other hand, continued to maintain a winning streak and retained its weekly gains above 45%.
It had formed a bottom on the 23rd of May when it fell below the $20-mark. However, on-chain market signals depicted a healthy market trend for the crypto-asset.
Where is Chainlink Headed?
It is important to note that Chainlink did bounce back quite effectively from a low of $17.50 to spin a gain of almost 2x at $35 levels before cooling off mildly. According to the crypto analytic platform, Santiment, LINK was now trading at a point of resistance and will have to stay above the support area for another chance to break above the resistance trendline. It noted
“Things will look really bad if we break support and go below the previous low, making yet another lower low to further confirms a bear trend.”
On the positive side, the recent bottom witnessed large clusters of spikes with respect to Daily Active Deposits. This ongoing trend may depict that a good amount of LINK holders have capitulated. Meanwhile, it was found that a large number of the token holders depositing. Santiment’s Exchange Inflow demonstrated signs of a significant amount of LINK was deposited near the recent bottom.
Upon looking at historical moves, the platform observed that in the past year, substantial inflows of the crypto-asset near bottoms have preceded a price uptrend. If it follows a similar path, Chainlink could, in fact, note a surge towards reclaiming its previous glory.
Besides, after the recent market correction that happened to be the biggest drop since last September, MVRV 30D spiraled down significantly and despite the uptick, it was still hovering in the undervalued zone. As per the crypto intelligence platform, this is good as the MVRV 30D settles down in a big way, as it offers less risk and ideal bottom pickings.
Hence, the overall market sentiment for Chainlink remained healthy signs after the market reset. The capitulation event can potentially be attributed to the exchange inflows and daily active deposits, which are ideal for forming bottoming structure.
Having said that, the digital asset was near a psychological resistance currently and the next few weeks will eventually reveal where the price is headed.