The price of Chainlink is poised for a significant breakout as excitement regarding the potential launch of spot exchange-traded funds (ETFs) grows. This development follows a fifth consecutive daily rally, with the token increasing nearly 3% on November 27, trading at $13.43. Despite this upward trend, the price remains 25.8% lower than a month ago and nearly 50% below its August peak of $26.75.
Investor enthusiasm has surged in light of the anticipated introduction of two spot ETFs, which are expected to launch possibly by December from Grayscale and Bitwise. These financial products would provide institutional investors with a pathway to gain exposure to LINK tokens without needing to directly acquire the cryptocurrency. The demand for spot ETFs is likely to support Chainlink”s price in the longer term.
Additionally, recent data from Nansen indicates that large holders, often referred to as whales, have increased their accumulation of LINK tokens, now owning 2.26 million compared to 1.67 million on November 20. Furthermore, the amount of LINK tokens held on exchanges has decreased by 4.5% over the past week, a trend that typically signals a bullish sentiment as it indicates a lower supply of tokens available for immediate sale.
Analyzing the daily chart, Chainlink”s price is approaching a breakout from a falling wedge pattern, characterized by two downward-sloping, converging trendlines. This configuration often signifies a bullish reversal, particularly when accompanied by rising trading volume or positive momentum indicators. The MACD has also formed a bullish crossover with its signal line, pointing to increasing buying pressure.
A successful breakout from this falling wedge could propel the price above the 50-day simple moving average, potentially targeting $21.6, which coincides with the 61.8% Fibonacci retracement level. Should the price decisively move above this threshold with robust trading volume and favorable market sentiment, LINK could revisit its August high of $26.75, marking an increase of nearly 100% from its current value.
