LINK hits three-week low, but whale behavior could force traders to…

  • Chainlink was among the top ten tokens bought by Ethereum whales
  • However, the on-chain data went against the accumulation measures

Chain link [LINK] became one of the top 10 tokens bought by the top 1000 Ethereum [ETH] whales, according to a December 10 tweet from WhaleStats.

According to the whale tracking platform, Chiliz [CHZ] also broke into the group in the last 24 hours. But the advent of LINK was special. Indeed, he entered the list despite registering a lackluster performance during the week.

Lily Chain link [LINK] Price prediction 2023-2024

Fall to your knees

CoinMarketCapit is Data showed that LINK was trading at $6.92 at press time. This value represented a decrease of 5.84% in the last seven days, also bringing LINK back to its lowest value in the last three weeks.

Due to the fall, LINK fell by market cap – after fading slightly Dogecoin [DOGE] in the weekly performance of the top 20 cryptocurrencies.

However, there have been a few notable events on Chainlink’s on-chain state, some of which have contributed to the recent pullback. According to Glassnode, LINK Herfindahl index rose to 0.00418 during the rally, but fell to 0.00393 at the time of writing.

Chainlink Herfindahl Index

Source: Glassnode

The Herfindahl Index acts as a measure of weighted address balances within a network. It also displays the supply concentration. Since LINK’s Herfindahl index reflected a low value, it involved relatively evenly distributed addresses, while supply was thinly concentrated.

The status of dormant circulation was also highlighted. Santiment chain platform show that LINK’s 90-day dormant circulation was 10,900. Prior to the current value, it improved to millions. Thus, most Chainlink tokens held during the period resisted any involvement in trading or spending.

The Spent Coins Age Band shared a similar sentiment with dormant circulation. At press time, LINK’s spent coin age range has dropped to 87,000. This metric indicated the number of tokens available versus spent in a given interval.

Since it represented a truncated value, he explained that LINK investors spent more tokens in a more recent period than they held. Thus, this could signal that the weekly drop in value could be related to selling pressure.

Chainlink Dormant Circulation and Spent Coins Band

Source: Santiment

Chainlink: Waiting for signs and wonders

Going forward, LINK may be struggling with minimal market spikes. This was due to indications revealed by the Network Value to Transactions (NVT) signal. At the time of writing, Chainlink’s NVT signal had fallen to 35.30.

At such a position, LINK showed traits of its value exceeding utility. Therefore, it may not be the right time to start reaccumulation.

Chainlink NVT signal

Source: Glassnode

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