Chainlink (LINK) experienced a severe correction this Monday, breaking vital technical supports and defying the current market’s bullish expectations. This decline occurs ironically on the eve of the expected spot LINK ETF launch in the United States. ETF analyst Nate Geraci noted that this investment vehicle could begin trading on NYSE Arca this very week, marking a regulatory milestone.
Market indicators reveal a massive sell-off, with the token’s price falling to $11.94 after losing the $13 level. Trading volume reached 7.14 million units, which represents a 280% increase over the daily average, evidencing a strong institutional exit. Thus, the price structure has confirmed a bearish trend characterized by successively lower highs on the daily chart.
Will the new financial product manage to stop the current massive liquidation?
On the other hand, the importance of this event lies in the transformation of Grayscale’s closed-end trust into a more accessible exchange-traded fund structure. This regulatory move was expected to inject optimism and fresh capital, validating the oracle network’s utility in the global digital economy. However, the market reaction has been completely opposite to fundamental logic, prioritizing technical analysis over positive corporate news.
Likewise, this negative behavior is not an isolated case but reflects a generalized fear that has dragged Bitcoin toward $84,000. Speculation regarding Bank of Japan rates has generated nervousness, directly affecting risk assets like LINK. Therefore, the break of the descending trendline poses a complicated scenario where the immediate support of $11.87 becomes crucial to avoid greater falls toward recently unexplored zones.
To conclude, technical traders have set their downside targets in the $11.70 to $11.80 range if selling pressure continues to intensify. If buyers fail to defend these levels, the asset could seek liquidity at the November lows situated at $11.39. Consequently, the investment community will closely watch the volume in the coming sessions to determine if the LINK ETF launch finally manages to reverse the prevailing negative sentiment.
