Chainlink (LINK) suddenly shows a potential for a 300% big pump? Analyst: first fall to 15 dollars then rush to 46.31 dollars

Chainlink (LINK) is currently trading at 18.21 USD. Analyst Ali Martinez predicts that if the token first falls to 15 USD (0.618 Fibonacci retracement level), it will see an astonishing rise of 300%, with a final target price set at 46.31 USD. The technical chart has formed an “inverse head and shoulders pattern” bullish pattern, and Whale investors have accumulated over 2.96 million LINK, valued at 52 million USD, while the exchange balance has sharply decreased by 21 million LINK, tightening supply and demand. Additionally, the LINK ETF applications submitted by Grayscale and Bitwise are under review by the SEC, and if approved, will become a new catalyst for institutional demand.

Analysts bullish on LINK: $15 is the best entry point

Chainlink has recently shown positive momentum, rising 2.41% in the past day and 7.64% in the past week, with the current trading price at 18.21 USD. Market analyst Ali Martinez has made an extremely bullish prediction based on the rising parallel channel that has guided the price trend since mid-2023.

(Source: TradingView)

300% rise technical path

• Pullback expectation: Martinez expects LINK to first pull back to around $15, which coincides exactly with the 0.618 Fibonacci retracement level. The analyst sees $15 as an excellent area for investors to accumulate and bottom-fish.
• Target Prediction: Starting from this accumulation area, Martinez predicts that LINK may eventually rise to 46.31 USD, a target that is consistent with the 1.272 Fibonacci extension level.
• Short-term resistance: Analysts remind that resistance around $20.04 may trigger a brief pullback in price to $18 before the main rebound begins.

LINK Token Economics Optimization: Strategic Reserve Plan Continues to Gain Momentum

Chainlink has taken proactive measures in token economics, further reducing the circulating supply in the market. Its Strategic LINK Reserves plan, launched in early August, utilizes all network revenue for LINK token buybacks.

Buybacks create sustained deflationary pressure

• Accumulated Results: Just this week, developers purchased 63,480 Tokens. Currently, the reserve has accumulated a total of 585,641 LINK, worth 10.4 million USD.
• Long-term impact: At the current repurchase rate, this reserve may exceed 100 million USD within 12 months. This ongoing repurchase pressure removes tokens from circulation, aiming to improve token economics and leverage future price rises, creating sustained demand in the market.

Technical indicators support bullish: inverse head and shoulders pattern and momentum improvement

Technical analysis signals indicate that Chainlink's momentum is strengthening, providing support for a potential breakout.

bullish technical pattern

• Inverse head and shoulders pattern: On the four-hour chart, LINK has formed an “inverse head and shoulders” pattern. The head is formed at $15.63, with a sloped neckline. This pattern is typically seen as a precursor to a bullish breakout.
• Momentum Recovery: The True Strength Index (TSI) has rebounded from -46 on October 11 to a neutral level; the Relative Strength Index (RSI) is slightly above 50. Both indicators show that momentum is improving.
• Short-term support: The LINK price has crossed above the 25-period Exponential Moving Average (EMA), simultaneously forming a bullish divergence pattern. These technical signals further support the possibility of a price rise.

This pattern suggests that the price may move towards $25, which implies a 42% rise from the current level, matching the high point on September 13.

Whale Accumulation and ETF Applications: The Driving Forces on Both Supply and Demand Ends

In addition to the technical aspects, Chainlink has also seen positive changes in its fundamentals and market supply and demand, mainly manifested in the accumulation by whales and the opening of institutional channels.

Whale continues to accumulate

• Whale Activity: According to Nansen's data, large investors have accumulated over 2.96 million LINK Tokens in recent weeks, worth 52 million USD. This large-scale purchase often signals confidence from experienced traders in the asset.
• Exchange balance sharply decreased: The LINK balance on the exchange has fallen from 284 million coins in September to the current 263 million coins, with an outflow of 21 million coins, worth 357 million USD. Token outflows from exchanges typically indicate that investors choose to hold (HODL) rather than sell, which reduces the tradable supply in the market.

SEC reviews LINK ETF

The ecological cooperation and revenue of Chainlink are also continuously enhancing its fundamentals. The U.S. government has chosen Chainlink as its on-chain data oracle platform and is collaborating with S&P Global to assess the stability of stablecoins. The revenue generated from these partnerships serves as the funding source for the strategic reserve program.

Institutional Channel: The SEC is currently reviewing the LINK fund ETF applications submitted by Grayscale and Bitwise. If approved, it will provide institutional investors with a regulated investment tool, potentially significantly increasing demand for LINK, similar to the launch of the Bitcoin ETF.

Conclusion

Technical analyst Ali Martinez's prediction of a 300% potential rise for Chainlink (LINK) is bold, but it is supported by various factors such as the “inverse head and shoulders pattern”, whale accumulation, and the supply reduction brought by strategic buybacks. As LINK's role in Web3 infrastructure becomes increasingly crucial, and the SEC continues to review LINK ETF applications, Chainlink is expected to become a focus for both institutions and retail investors in the next bull market. Investors should look for entry opportunities around $15 and closely monitor the progress of ETF approvals.

Disclaimer: This article is for news information only and does not constitute any investment advice. The cryptocurrency market is highly volatile, and investors should make cautious decisions.