Many large-cap cryptocurrencies are experiencing gains, with Chainlink (LINK) seeing a notable 10% price rise in the last 24 hours. However, indicators suggest this might be short-lived.
Data from CryptoQuant shows LINK's reserves on exchanges have peaked, indicating potential selling pressure. This trend implies long-term holders might be returning tokens to exchanges, possibly hinting at an imminent retracement.
The cryptocurrency's social dominance, tracked by Santiment, shows increased market attention, historically indicative of price movements. While a higher social dominance can lead to rising prices, excessive focus often signals a local price peak, driven by FOMO (Fear of Missing Out).
On the daily chart, LINK has formed a bearish pennant, a pattern that usually suggests a continuation of a downtrend. If this occurs, LINK's price could dip below $10, potentially reaching $9.95. However, intensified buying pressure could invalidate this bearish outlook, maintaining the uptrend.
Conversely, if LINK manages to break out of the bearish pennant, it may target the next resistance level at $13.10, shifting market sentiment and attracting further buying interest.
