Chainlink turns resistance into support as whales continue accumulating LINK

• Chainlink price regained ground above a substantial supply area that now serves as strong support.
• On-chain metrics show LINK enjoys the confidence of the large investors.

Chainlink (LINK) has partially recovered the previous day’s losses to trade at $10.5 at the time of writing. The 6th largest digital asset with the current market capitalization of $4.1 billion has gained 1.8% in the last 24 hours; however, it is still 9% down on a week-to-week basis.

The cryptocurrency is trying to clear a vital resistance area reinforced by a combination of technical and on-chain metrics.

Chainlink whales accumulating tokens

As the cryptocurrency market gets comfortable with the outcome of the US Presidential elections, LINK traders have something special to think about. The mounting buying pressure seems to be correlated with LINK whales transactions. According to Santiment’s transaction tracker, someone transferred 2 million LINK tokens (about $21 million) between Binance accounts. 

The on-chain data provider reports that this is the seventh instance of this amount of tokens transferred between these exact addresses. Notably, the previous transaction took place on October 7 and resulted in a 30% LINK price increase in less than five days. 

LINK’s transaction tracker
 

Besides, the Holder Distribution data shows that the number of wallets holding 10,000 to 100,000 LINK tokens has increased by nearly 100 in less than a month. A steady upside trend visible on the chart below implies that large investors maintain confidence in LINK and continue accumulating tokens. Meanwhile, the divergence between the holders’ distribution trend and the price movements may signal that LINK is on the verge of a massive upside correction.

LINK’s Holders’ Distribution

LINK price forecast 

It is worth mentioning that the altcoin is trying to settle above the strong support area. Based on IntoTheBlock’s “In/Out of the Money Around Price” model, nearly 9,000 addresses previously purchased over 49 million LINK tokens between $10.24 and $10.55. Notably, this supply wall served as formidable resistance at the beginning of the week. If the breakthrough is confirmed and buy orders continue to pile up, LINK may quickly move towards $12 with little resistance on the way. 

LINK In/Out of the Money Around Price

Given the unpredictability of the cryptocurrency market, the bearish outlook cannot be disregarded. 

A sudden spike in the selling pressure behind the token that can flip $10.24-$10.55 support into resistance may invalidate the bullish scenario. Under such circumstances, LINK price could drop towards the next local hurdle of $9.