Chainlink is down by a percentage point in today’s trading session. According to year-to-date data, the drop comes amidst a turbulent year that has seen the cryptocurrency lose more than 44 per cent. Using the 2022 price highs, Chainlink has lost 61 per cent since January 11.
In yesterday’s trading session, the cryptocurrency had shown signs of a bullish move. However, the past 24 hours’ drop of 28.58 of chainlink trading volume seems to have been translated into the markets resulting in the current bearish move. The past 24 hours saw a total of $458 million worth of chainlink transacted to put the trading volume into context. This is a sharp decline from what the cryptocurrency was trading in January. For instance, on January 5, 2022, the total trading volume in 24 hours totalled over $4 billion. Compared to today, this is an 88 per cent trading volume decline in just the first few months of 2022.
The current drop in price also comes at a time when Chainlink continues to gain traction. New decentralised finance (DeFi) applications are getting developed in the platform, which are likely to impact its future. A good example is the recent announcement of a censorship-resistant inflation index that is being built on Chainlink. According to its developers, the new DeFi application, which is called Truflation, will be able to offer reliable inflation data. Recently, the platform announced their estimated the true inflation to be around 13.3 per cent. This is as opposed to the 7.9 per cent as measured by the Bureau of Labor Statistics. Such developments in the platform are likely to generate traction to the platform. This will likely result in increased usage and price gain of the chainlink cryptocurrency.
Looking at the daily chart below, we see that the chainlink price has been forming new yearly price lows. The chart also shows that, although the prices recently broke the support level and showed signs of returning to the support and resistance structure, it is unlikely that the prices will start a new bullish trend.
Therefore, I expect the prices to continue dropping for the next few days. There is a high likelihood of the prices dropping to trade below the $10 psychological level. IT is also highly likely that the current drop may end up trading just above the $8 price level.
This post was last modified on %s = human-readable time difference 15:49