ChainLink price could succumb to profit taking by whales

ChainLink whales could take profits and send LINK price lower as 92% wallet addresses sit on unrealized gains.
A spike in ChainLink whale transactions coincides with realized profits since the beginning of December.
LINK price is above key support between $14.55 to $15.94, where 38,600 wallets accumulated over $84 million ChainLink tokens.

LINK price is likely on the brink of a correction driven by increasing profit taking by large wallet addresses in its network. The launch of v0.2 of LINK staking acted as a catalyst for ChainLink, driving price gains in the altcoin, however, now that many large-wallet holders are sitting on unrealized profits there is a risk they may cash in, driving price back down.

ChainLink v.0.2 staking pool fills up

According to a ChainLink tweet on X, posted on December 11, ChainLink’s v0.2 community staking pool has officially filled with over 40.87 million LINK tokens staked – both by users migrating from v0.1 and new participants.

Existing stakers could withdraw their staked tokens and make pool space available for new stakers, opening up v0.2 for anyone in the ecosystem.

The #Chainlink Staking v0.2 community pool has officially filled, with over 19M additional LINK staked in under 7 hours since Early Access opened ⬡

We want to thank the community—both v0.1 migrators and new stakers—for participating in the v0.2 launch and putting 40,875,000… pic.twitter.com/SpbFR7b7lX
— Chainlink (@chainlink) December 7, 2023

Also read: Bitcoin analyst calls early bull market in the beginning of 2024, BTC price could tag $50,000

ChainLink price likely to struggle as whales engage in profit taking

According to on-chain data from crypto intelligence tracker Santiment, there is a bearish divergence in the network growth metric for LINK. Network growth tracks the number of new addresses being created in the asset’s network each day and this can help determine whether LINK is losing traction or gaining adoption among market participants.

ChainLink’s network growth currently shows a bearish divergence with LINK price. This supports a thesis of an impending correction in LINK.

ChainLink network growth and price Source: Santiment

ChainLink price risks crumbling under rising selling pressure, as whale wallet addresses engage in profit taking activities. The whale transactions valued at $100,000 and higher coincide with profit taking spikes in the Network Realized Profit/Loss (NPL) metric, between December 1 and 8. This implies, large wallet addresses are booking profits in LINK, which is likely to increase the selling pressure on the asset across exchanges.

ChainLink whale transaction count (>$100,000), NPL Source: Santiment

LINK price sits above crucial support

ChainLink price is currently above the crucial support zone between $14.55 to $15.94 where 38,660 wallets accumulated $84.1 million ChainLink tokens, according to data from IntoTheBlock. LINK price is currently at $16.08 on Binance.

It is important to note that 92.49% wallet addresses that are currently sitting on profits could engage in profit taking and drive LINK price lower.

Global In/Out of the Money Source:IntoTheBlock

In the event of a decline, LINK price could find support in the zone between $14.55 and $15.94.

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