After three consecutive days of downside moves, Chainlink [LINK] has now reached a key support level that it has held since February 2026. This level appears to be a make-or-break point for the asset, as broader market sentiment remains bearish.
On the 3rd of June, LINK declined by 4.50% and was trading at $8.55 after falling to an intraday low of $8.18. Despite the price drop, market participants have shown strong interest in the asset, as its trading volume surged 31% to $478 million.
LINK eyes potential recovery
According to TradingView’s daily chart, LINK remained in a downtrend, as its price continued to trade below the 200-day Exponential Moving Average (EMA).
However, its recent move toward the key support level of $8.05 suggests that LINK may repeat history with a strong price recovery, as it has done several times in the past. At the same time, this level serves as a make-or-break zone for the asset.
If LINK remains above the $8.05 support level, it could experience a strong recovery similar to the rebounds seen on four previous occasions between February 2026 and June 2026.
However, if the price falls below $8.05 or closes a daily candle beneath this key level, it could open the door to a significant decline.
At press time, LINK’s Average Directional Index (ADX) indicates weak trend strength, as the indicator has fallen to 20.37, below the key threshold of 25.
Investors and traders’ sentiment turns bullish
On the analytics side, investors and long-term holders appeared to be accumulating the asset. Data from the analytics platform CryptoQuant revealed that LINK’s exchange reserves have declined by 197,000 tokens over the past week, indicating potential accumulation.
Meanwhile, intraday traders also appear to be following the same trend by betting on a price recovery.
Data from the derivatives platform CoinGlass revealed that LINK’s OI-Weighted Funding Rate has turned positive and reached +0.0077%, indicating that traders are increasingly opening long positions and expecting the asset’s price to go higher.
At press time, the major liquidation level on the downside stands at $8.16, where traders are overleveraged and have opened $1.98 million worth of long positions.
Meanwhile, $8.67 on the upside is another key liquidation level, where short traders are overleveraged and have opened $1.55 million worth of short positions.
These positions on both the long and short sides suggest that bulls currently hold a slight advantage in the market, while bearish momentum appears to be weakening.
Final Summary
- Chainlink’s daily chart suggests that the asset is poised for a reversal, as it has successfully held the $8.05 support level.
- On-chain and derivatives data further strengthen LINK’s recovery potential, as exchange reserves decline while traders increasingly bet on higher prices.