Chainlink broke out and led the recovery for top altcoins today after rallying 25% and breaking above the psychological resistance turned support level of $15. We look at the factors informing such a price jump and discuss its next price action.
After recording yet another devastating price drop yesterday, Chainlink is back on recovery.
On Wednesday, March. 5, the altcoin led the recovery for top altcoins after rallying by more than 25% in the last 24 hours. The altcoin’s price jumped from yesterday’s low of $13.21 to the intraday high of $16.40.
The surprise recovery made it the third-best-performing digital asset of the day among the 15 most valuable cryptos, behind Cardano and PI coins, whose prices jumped by more than 30% in the day.
Chainlink also experienced massive volatility with daily trading volume for the altcoin surging by 20% to reach $987 Million.
The outsized gains exceeded the industry average as it only added 5% to its market cap.
3 Reasons Explaining Chainlink’s Sudden Explosion
Chainlink’s explosive price action today may be traced back to three key factors. First is the massive whale accumulation that has been going on for the last three months.
In February, for instance, the top 1000 Chainlink addresses added close to 2 million LINK tokens to their portfolio, equivalent to more than $30 Million worth of tokens in February.
The buy pressure associated with such a voluminous purchase not only helped it defend the current support level of $15 and will possibly help trigger its next phase of growth.
Secondly, the general consensus within the crypto industry is that the market is still primed for a breakout.
Top investors, like Strategy and Metaplanet, have also been engaged in aggressive accumulation of Bitcoin and other assets, which has inspired confidence in the market’s direction.
Chainlink’s correction may also be explained by the fact that most of the factors that triggered its last dip were temporal. Today’s price surge, for instance, was noticeable as it follows a 20% crash less than 48 hours ago.
The crash was triggered by fears of a trade war after Trump enforced further tariffs and it is only natural that LINK token prices rebound in reaction to the fizzling trade war FUD.
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What’s Next for Chainlink Price
In the short to medium term, Chainlink will continue trading sideways. The threat of tariffs and other macros will continue to influence LINK’s immediate price action.
Over the longer term, Chainlink will continue uptrending. A growing number of analysts are especially confident that it can break above $50 before the end of the year. In getting here, however, the altcoin will need to tap into its unmatched resilience and seek further force from the upcoming market rally.
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