Chainlink slides to $11.56 after rally, technicals flag oversold zone

Key technical indicators shift bearish

LINK’s recent decline has returned it to its previous trading range from late August, an area closely monitored by traders due to past buying interest. Price momentum is weakening, with the Relative Strength Index (RSI) falling to 31.58, approaching oversold territory.

The Moving Average Convergence Divergence (MACD), another popular momentum indicator, has also moved deeper into bearish territory. The indicator’s signal line is dropping, and the red histogram bars have grown larger, indicating increased selling pressure.

LINK’s technical indicators reflect strong selling, with RSI near oversold levels and the MACD turning more negative as the price retreats toward older support ranges.

Traders reduce risk as volumes decline

Data from derivatives monitoring platforms reveals that trading activity has cooled. CoinGlass, a leading cryptocurrency data analytics provider, reports that LINK’s trading volume dropped to $507.51 million, while open interest stands at $645.90 million. These figures suggest a reduction in leveraged positions as market participants reduce exposure amidst heightened volatility.

More Crypto Online, a cryptocurrency analyst, described the current correction as the initial “wave (A)” in a potential three-wave pullback. The analyst identified $12.30 to $13.21 as the first key resistance area; a move above this band could indicate renewed momentum, while failure to regain this level may prolong the correction.

On-chain activity signals resilient network growth

Despite the price pullback, Chainlink’s network activity remains robust. Data from analytics firm Santiment Intelligence indicates that newly created addresses grew from about 974 per day in early August to a peak of 1,601 before stabilizing near 1,140. Active addresses followed this trend, increasing from roughly 3,599 to 5,572 at the peak, and now hovering around 4,821.

Santiment Intelligence highlighted that this surge in new and active addresses is specific to Chainlink. When compared with blockchains such as Solana and Ethereum during the same period, LINK’s user engagement appeared especially resilient, underscoring consistent utility for the decentralized oracle network.

Mini dictionary: Chainlink is a decentralized oracle network designed to connect blockchain-based smart contracts with real-world data, enabling secure and reliable data feed integration.

Santiment Intelligence noted continued growth in new and active Chainlink addresses, despite declining prices, demonstrating ongoing network adoption compared to other major blockchains.

However, analysts cautioned that wallet address metrics have limitations. These figures cannot distinguish whether the activity comes from new users or repeat participation from existing users.

Market observers are now focusing on whether LINK can stabilize above its previous support. Watchpoints include the $12.30 to $13.21 resistance zone, as well as movements in trading volume, open interest, RSI, and MACD for the next decisive move.