LINK Plunges 12%: 73.5M Tokens in Red, Bearish Outlook Looms

Chainlink's native token, LINK, has experienced a significant price drop, with a 12% decline in the last 24 hours, pushing its price close to $13.80. This decline follows the loss of a crucial support level at $14.85, where 17,000 investors and long-term holders accumulated 73.5 million LINK tokens. According to on-chain analytics firm IntoTheBlock, this loss has turned the holdings of these investors red, indicating substantial losses.

Following this development, only 24.96% of LINK holders are now in the money, while 74.74% are facing losses. The trading volume during this period has also dropped by 15%, suggesting lower participation from investors and traders compared to the previous day. This decrease in trading volume, coupled with the significant price drop, indicates a potential further decline in LINK's price.

Technical analysis by AMBCrypto suggests that LINK may be poised for further downside momentum after breaking out of its three-day-long consolidation between $15.85 and $14.85. If the asset closes a daily candle below the $13.80-mark, there is a strong possibility it could drop by another 10% to hit the $12.20-level in the near future. Additionally, LINK may struggle to move above the 200 Exponential Moving Average (EMA) on the daily timeframe, indicating a potential downtrend.

The bearish outlook for LINK is further supported by the dominance of intraday traders betting on short positions. According to on-chain analytics firm Coinglass, traders holding short positions are currently over-leveraged at $14.82, having built nearly $10.16 million worth of short positions. In contrast, traders betting on long positions might be exhausted, with over-leveraging at $13, where they have built only $4.26 million worth of long positions. These over-leveraged positions reflect the true nature of market sentiment, suggesting a strong possibility that short traders could easily push the price to $13 or even lower by liquidating long positions.