LINK Price Could Drop to $5 Despite Slight Weekend Recovery: Analyst

Key Insights:

• Analyst warns LINK price could slide to $5 amid 19% spike in exchange inflows.
• Whales quietly accumulate $2.48M in Chainlink coins on Binance and Coinbase.
• Adoption keeps accelerating with 20 new Chainlink integrations across 12 chains

Chainlink (LINK) price has dropped 3% over the last 24 hours and now trades at $8.62, when writing. The price drop occurred despite clear growth in Chainlink adoption in terms of integrations.

Meanwhile, a top market analyst predicts that LINK price is heading toward fresh lows amid fresh sell pressure. Will Chainlink price avert further losses amid increasing sell pressure?

LINK Price Faces Fresh Sell Pressure from Exchange Inflows

TopNotchYJ, an analyst on CryptoQuant, has cautioned LINK investors on another potential capitulation that could send the price as low as $5. The analyst revealed that Chainlink saw a massive 19% spike in tokens on centralized exchanges on 9 February. That occurred after 3 consecutive days of outflows.

Such volume spikes usually signal that sellers anticipate further downside. More supply hitting order books typically leads to potential price suppression.

This happened after Chainlink price posted a brief recovery to $7.19, reeling retail traders back in. Fresh inflows on centralized exchanges could push LINK price lower in the short term, and the CryptoQuant analyst thinks it could drop as low as $5.

Those expectations were also supported by weak accumulation, as indicated by the Chainlink Money Flow Index (MFI). However, on-chain data showed that Binance and Coinbase were loading up at recently discounted prices.

Data from Coinglass shows Whale investors on Binance and Coinbase exchanges are accumulating. Over the last 2 days, large investors have stacked $2.48 million worth of LINK tokens across the two exchanges.

Whales may absorb existing sell pressure if they keep buying, which might limit the potential downside.

Chainlink Publishes Its Latest Adoption Update

Chainlink continues to grind behind the scenes even as the fate of the LINK price hangs in the balance. The network just posted its latest Chainlink adoption update, showcasing 20 new integrations of the Chainlink standard across 12 different chains.

While there were several integrations, the standout was Chainlink Runtime Environment (CRE). It added 9 new integrations.

CRE is one of the newer Chainlink services that allows developers to run sophisticated, institutional-grade workflows. It can also connect off-chain systems with multiple blockchains. Thus, it allows legacy systems like JPMorgan and Swift to onboard blockchain technology seamlessly.

These developments reflected the Chainlink network’s push towards supporting institutional blockchain adoption.

LINK Price Faces Rejection at Key Market Imbalance Point

The 4-hour LINK chart shows the asset hit a snag amid its recovery from the $7.19 low as price action bounced to fill a marker imbalance around the $8.9 – $9.24 range. Now that the fair value gap (FVG) is filled, the Chainlink price shows signs of resuming its downward trend.

The Relative Strength Index (RSI) also flagged multiple rejections at the 50-level. A sign of weakness that could result in the price action sliding lower if sell pressure intensifies.

The 7-day Liquidation Map for LINK further reinforced the bearish trend as the cumulative Short liquidation leverage ($26.72 million) eclipsed the corresponding Longs ($14.65 million).

This discrepancy reflected the market sentiment around LINK crypto, as traders anticipated an extended downtrend.

The Liquidation Map revealed $8.43 and $8.19 as key price points to watch. They underscored the largest leveraged long liquidation exposure to the downside. In other words, a long squeeze near $8.19 may trigger a drop toward $7.39

Can LINK Crypto Avert This Fall?

LINK price faced further downside potential after kicking off the week with rising sell pressure and limited retail demand. This means LINK bears might regain control if demand fails to materialize.

Despite this, some whales on Binance and Coinbase have been buying the dip. This may be a confidence booster for LINK traders seeking evidence of demand amid prevailing bearish expectations.

After all, the LINK price was still trading close to its 2-year lows. This represents a sizable discount that traders may find attractive for the long run.