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Chainlink price remains in a strong bear market, mirroring the performance of other coins. LINK was trading at $12.46 on Monday, down from the year-to-date high of $27.82. This crash may be about to end after the token formed an encouraging bullish pattern after landing at a crucial support level ahead of the GLNK ETF launch.
Chainlink Price Technicals Point to a Rebound
The daily chart shows that the LINK price has plunged in the past few months. This crash coincided with the plunge of Bitcoin and other altcoins like Solana and Ethereum.
Most technicals point to an extended Chainlink price crash. For example, the coin has remained below all moving averages, a sign that bears are in control for now. The Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) have all continued their downtrend.
However, a closer look at this chart points to a rebound in the coming weeks. For one, the coin’s lowest point this month was close to its June lows. That is a sign that it is about to bottom.
The other bullish aspect is that the coin’s Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) are nearing their oversold levels. In most cases, rebounds happen whenever an asset becomes highly oversold.
Most importantly, Chainlink price has formed a falling wedge pattern, which is made up of two descending and converging trendlines. These two line are now nearing their convergence point, a sign that a bullish breakout is nearing.
If this happens, the next LINK price target will be the psychological point at $15, which is about 21% above the current level. A move above that level will point to more gains, potentially to the psychological point at $17.97, its highest level on May 12.
The bearish LINK price forecast will become invalid if the token drops and loses the key psychological point at $10.
Grayscale Chainlink ETF Launch as a Catalyst
One potential catalyst for the Chainlink price is the upcoming launch of the Grayscale LINK ETF (GLNK). According to Eric Balchunas, Bloomberg’s ETF Strategist, the company will likely launch its ETF next week. This will happen after Grayscale launches the XRP and DOGE ETFs.
There are also signs that Bitwise will launch its Chainlink ETF in the next few weeks. These funds are important as they will give American investors a way to invest in it.
Recent data shows that there is a robust demand for altcoin ETFs. For example, the Bitwise and Canary XRP ETFs have accumulated over $422 million in inflows a few weeks after the launch. Similarly, all the Act 33 Solana ETFs have collected over $510 million in inflows.
Chainlink will likely experience such inflows because of its popularity in the crypto industry. For one, it has become the biggest oracle network in crypto, with a total value secured of over $60 billion.
Chainlink has also become an important player in the Real-World Asset (RWA) tokenization industry. Its Cross-Chain Interoperability Protocol (CCIP) has been embraced by some of the biggest companies globally, like ANZ Bank and JPMorgan.
LINK Supply in Exchanges Has Tumbled
The upcoming GLNK ETF launch likely explains why the supply of tokens in exchange has been in a strong freefall this year. According to Nansen, there are now 212.7 million tokens in exchanges, down from over 300 million last month. This means that the supply has tumbled by 30%, a figure that may continue in the near term.
Another potential catalyst for the Chainlink price is that the futures open interest has tumbled in the past few months. It dropped to $528 million today, down from $1.6 billion in August. While a falling open interest is normally a bearish thing, bull runs normally start in such conditions. This happens when investors start to deploy leverage as they buy the dip.
