- Chainlink price witnessed a short-term correction with the formation of a bull flag pattern.
- Earlier today Chainlink Reverse accumulated 45,729 LINK, expanding its total holding to 463,190 LINK
- Open interest in Chainlink-linked futures contracts has climbed 12% since fortnight, signalling a rise in leveraged participation and speculative positioning around LINK.
Oracle network Chainlink’s (LINK) native token plunged over 2.4% during Thursday’s U.S. market session. The selling aligns with a broader market pullback as the U.S. government shutdown extended to the 9th day, driving market uncertainty and delays in key economic data. However, the LINK price shows notable resilience above the $20 floor amid renewed interest in the asset’s future contracts and active accumulation from the Chainlink Reserve. Will the altcoin resume its prevailing recovery?
Chainlink Reserve Adds Another 45,729 LINK
The Chainlink Reserve has also continued to increase its holdings this week, with another 45,729 LINK tokens added, valued at roughly $992,776 based on an estimated average purchase price of $21.71. With this most recent transaction, the total balance of the reserve currently stands at close to 463,190 LINK, or approximately $10.1 million in total, at an average cost basis of $22.40.
The reserve initiative is an accumulation mechanism designed to benefit the financial foundation of the Chainlink ecosystem. It draws capital from two sources: on-chain service fees and off-chain revenues generated as a result of enterprise integrations of Chainlink’s Oracle infrastructure. The program periodically purchases LINK from the open market and contributes towards long-term network support and operational sustainability.
On-chain data reveal that this is not an isolated purchase. The reserve went for a similar accumulation of about 46,441 LINK on October 2. Transaction records for August and September also reveal four separate buy events, suggesting that the reserve might make some purchases later this month.
While the spot price for the token has seen a moderate correction in the past sessions, it seems that the derivative market activity is growing stronger. According to Coinglass data, the open interest in futures contracts linked to Chainlink tokens has surged from $1.23 billion to $1.41 billion in the last two weeks, accounting for a 16.5% jump. This growth indicates that traders are increasing their leveraged posting in the derivative market in anticipation of a major move.
The combination of renewed accumulation by the Chainlink Reserve and a resurgence of futures market activity brings new liquidity to the market, which could have an impact on near-term volatility.
Chainlink Price To Extend Correction with Flag Pattern
Over the past seven weeks, the Chainlink price has witnessed a notable correction from $27.87 to $22, accounting for a 21% loss. Interestingly, this bearish pullback has resonated strictly within two downslope trendlines, revealing the formation of a bull flag pattern.
The chart setup is commonly spotted within an established uptrend, as it allows replenishing the exhausted bullish momentum before the next leap. Amid the recent profit-taking in the crypto market, the LINK price shows a bearish reversal from the pattern’s resistance trendline.
If the selling pressure persists, the coin price could plunge another 18% before finding suitable support at the bottom trendline around $17.8. However, until the pattern is intact, the LINK buyers have an opportunity to counterattack.
If the pattern plays as intended, the Chainlink price could breach the overhead trendline, signaling the continuation of the prevailing recovery. The post-breakout rally could push the price against the $27.8 barrier.
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