Chainlink (LINK) has also been affected by the decline in the crypto markets, including Bitcoin (BTC). According to crypto experts, LINK may enter an upward trend after a period of lower volatility over the past few weeks. So, what data supports this view?
Critical Formation in LINK
The cryptocurrency’s price is trading below three key moving averages that could help predict its direction in the coming days. Experts generally consider this situation in altcoins as an indication of a downward momentum. Additionally, the relative strength index (RSI), a metric effectively used to determine the future direction of cryptocurrency prices, is at 39.54. The RSI is below the neutral level of 50 but above the oversold region.
However, considering the repetition of inverse head-and-shoulders formations in the altcoin and the price being below the moving averages, there is a prevailing thought that LINK is preparing for an upward momentum. Additionally, the drop in the MVRV ratio indicates that many investors who bought the token in the last two months have ended up with losses in their wallets. Generally speaking, a lower MVRV ratio can indicate that the token in question is undervalued.
Futures Balance in LINK
This interpretation may indicate a potential buying opportunity with a renewed confidence in the altcoin’s price in the near future. Although the token’s social media metric is not on the rise, its stable stance has caught the attention of experts. On the other hand, LINK’s derivatives trading volume witnessed a surprising increase of 85.94%.
Considering all this data, a high level of activity and investor interest could result if the upward trend is invalidated. If we consider LINK’s futures data, the Long/Short ratio also shows a more balanced picture among investors in general market data. Given the current formation and recent market movements, an upward scenario for LINK can be predicted.
