Top 5 Reasons Chainlink Could Rebound Strongly This December

Chainlink price rose for two straight days. It hit the highest level since September 14. The crypto market rebounded after Grayscale launched the first LINK ETF.

Still, the token remains much lower than the year-to-date high of $27. This article highlights some of the top reasons why the LINK price is ripe for a rebound in December.

Chainlink Price to Benefit From Whale Buying

Whale investors kept buying during the recent dip. Their steady accumulation signals confidence. This strong demand is one key reason why the Chainlink price looks set for a sharp comeback.

Whales are defined as large investors who, in most cases, are usually more experienced than retail traders. As the chart below illustrates, whales currently hold 2.92 million tokens, valued at over $42 million.

Their holdings have been in a strong uptrend after bottoming at 1.76 million earlier last month. These investors likely see several catalysts that will boost the LINK price over time.

Supply of LINK Tokens on Exchanges is Falling

Meanwhile, the ongoing Chainlink accumulation has coincided with the plunge of LINK tokens on exchanges.

Nansen data shows that there are 217.9 million LINK tokens on exchanges, much lower than 300 million in November. This means that the supply has dropped by nearly 30% in a month, which is a positive sign.

The supply on exchanges has dropped for months, after peaking at 322 million in June. This steady decline supports Chainlink price momentum and signals growing investor confidence.

Grayscale Launched the First Chainlink ETF

Another key catalyst for the LINK price is growing institutional interest. Grayscale launched the first LINK ETF on Tuesday. This move could open the door for major capital inflows and strengthen Chainlink’s market position.

GLNK started with over $17 million in assets. It’s a figure that may continue to rise as Chainlink has some of the best fundamentals in the crypto industry. There, it offers the biggest Oracle network.

DeFiLlama shows that Chainlink has a total value secured (TVS) of $50 billion, giving it a market dominance of 62%. It is much bigger than other networks in the industry, like Chronicle, RedStone, Pyth, and Band Protocol.

Additionally, in a recent report, Grayscale noted that Chainlink was a vital player in the booming RWA tokenization industry. It does that through the Cross-Chain Interoperability Protocol (CCIP).

Therefore, these fundamentals may help it attract substantial assets from investors as other recently launched tokens have done. For example, spot XRP and Solana ETFs have continued to accumulate assets after their launch.

Pandl echoed key points from the November research report. He pointed out that Chainlink was already considered “critical infrastructure” in blockchain-based finance or Decentralized Finance (DeFi).

Strategic LINK Reserves Growth Continuing

Another bullish catalyst for the Chainlink price is the company’s aggressive buying strategy. Since August, it has accelerated purchases through its Strategic LINK Reserves.

This steady accumulation strengthens demand and supports the case for a strong rebound. This program aims to purchase LINK tokens using the fees generated from on-chain and off-chain activities.

Data shows that the accumulation has resulted in 973,753 coins worth $14 million. This growth is likely to continue rising in the coming years as the network generates more revenue.

Chainlink Price Technical Analysis Suggests a Rebound is Possible

The daily timeframe chart shows that the LINK price has formed several bullish patterns. These patterns may lead to a strong rebound in the near term.

For example, it has formed a small double-bottom pattern at $11.77 and a neckline at $13.4. This pattern is one of the most accurate bullish signs.

It has formed a larger double-bottom pattern at $11.56 and a neckline at $27.80, its highest level as of August 22nd. These patterns point to a rebound soon.

Additionally, the token has been forming a falling wedge, as shown in black. It has already moved above the upper side of the wedge, meaning that a prolonged rally could be coming.

The Relative Strength Index (RSI) and its indicators have also pointed upwards, indicating a bullish trend. Chainlink price is likely to rebound in December. It may retest the psychological $20 level soon.