Chainlink (LINK) is trading at $11.16 at the time of writing on Thursday, extending its decline for the second consecutive day amid broader crypto market weakness.
Oracle Token is down 9.4% in the past week, 5.5% in the last 24 hours, and 4.9% intraday. Sellers appear to be targeting the crucial $11.00 psychological support level, a range that could determine whether LINK stabilizes or accelerates its correction below $10.00.
Chainlink trades under pressure as retail interest slows
Chainlink is facing a decrease in retail interest, with futures open interest (OI) falling to $562 million on Thursday from $580 million the previous day. The decline is part of a longer-term bearish trend that has seen LINK’s derivatives OI fall from a record high of $1.91 billion in August.
OI tracks the notional value of outstanding futures contracts; Therefore, low retail activity indicates that investors are not confident in the token’s ability to maintain its bullishness. Furthermore, this means that investors are closing positions rather than opening new ones, depriving LINK of the tailwind that sustains its uptrend.
Despite retail investors remaining on the sidelines, Chainlink is attracting interest from institutional investors through exchange-traded funds (ETFs). Investors seeking altcoin-based ETFs deposited approximately $734,000 into the Link Spot ETF, bringing total cumulative inflows to $73 million and assets under management to $86 million.
Technical Outlook: Chainlink sellers tighten grip as losses mount
Chainlink is trading lower but remains above $11.00 as indicators point to bearish sentiment, which aligns with weak sentiment in the broader cryptocurrency market. The Relative Strength Index (RSI) on the daily chart is at 35, which is close to the oversold zone while maintaining a bearish outlook.
Meanwhile, the moving average convergence divergence (MACD) indicator remains below its signal line, while the histogram bars extend below the zero line, prompting investors to sell LINK.
Below the immediate support at $11.00, Chainlink could extend its correction to the next key level at $8.10.
Any attempts to regain lost ground should be accompanied by excessive volume and a move above the 50-day exponential moving average (EMA) at $13.02. The 100-day EMA has a ceiling of $14.17 and the 200-day EMA has a ceiling of $15.51.
Crypto ETF FAQ
An exchange-traded fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can track not just a single asset, but also groups of assets and sectors. For example, a Bitcoin ETF tracks the price of Bitcoin. An ETF is a tool that investors use to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities and Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still awaiting regulatory permission. The SEC says the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the past few years.
Yes. The SEC approved the listing and trading of several Bitcoin spot exchange-traded funds in January 2024, opening the door for institutional capital and mainstream investors to trade the main cryptocurrency. The industry described this decision as a game changer.
The main advantage of crypto ETFs is the possibility of exposure to cryptocurrencies without ownership, thereby reducing the risk and cost of holding assets. Other advantages are a lower learning curve for investors and higher security as ETFs take charge of securitizing the underlying asset holdings. As far as the main drawbacks go, the main drawback is that as an investor you cannot have direct ownership of the asset, or, as they say in crypto, “not your keys, not your coins.” Other disadvantages are the high costs associated with holding crypto because ETFs charge fees for active management. Finally, even though investing in an ETF reduces the risk of holding the asset, price fluctuations in the underlying cryptocurrency are likely to be reflected in the investment vehicle as well.
