Chainlink (LINK) Price Analysis: Trump-Linked Fund and Whales Drive Rally Potential, But Overhead Supply Limits Upside

LINK, the cryptocurrency of the decentralized oracle network Chainlink is down 4% during Friday's U.S. market session. The pullback follows broader market uncertainty as Bitcoin struggles to hold a $100k level.

The price of Chainlink (LINK) has dropped by 4% during Friday’s U.S. market session after a recent surge, as the broader market faced uncertainty with Bitcoin’s struggle to maintain the $100k level.

However, the cryptocurrency linked to Trump’s fund and large investors’ activity hint at a potential bullish momentum for LINK’s price.

Here’s a closer look at the key highlights:

Trump-Linked Fund, Whales Drive Chainlink Price Rally

Recent data from World Liberty Financial Fund, reportedly linked to Donald Trump, shows that the fund has acquired 78,387 Chainlink (LINK) for about $2 million and 4,043 Aave (AAVE) at $1.25 million.

Both acquisitions were made at significant gains of 11.6% and 17.4%, respectively, as of December 12th, according to SpotOnChain.

Meanwhile, Lookonchain reports that a whale has purchased 175,424 LINK at an average price of $28.18 on December 12th, with a total investment of 1,263 ETH ($4.94 million).

This large-scale buying activity suggests that institutions and “whales” are accumulating LINK, which could be a bullish sign for the cryptocurrency.

Chainlink Price Analysis: Overhead Supply Caps Rally Potential

Chainlink’s price faced a hurdle in the first half of December, as overhead supply at $30 limited buyers’ attempts to push the asset higher.

This selling pressure is also highlighted by long-wick rejection candles in LINK’s daily chart, which could indicate a potential reversal in the near future.

The anticipated pullback might drag the asset down by 18% to retest the 20-day EMA support at around $22.5. This dynamic support has helped buyers throughout mid-November to recover the bullish momentum and maintain a sustained recovery.

As long as this support holds, Chainlink’s price is poised for a high-momentum rally, with the potential to challenge the $40 level.

ADX Spike, Momentum Indicator Shows Overstretched Rally

On the other hand, the momentum indicator ADX spiked to 47% on the daily chart, which signals an overextended rally.

This could indicate that Chainlink’s price might not be able to rally to $40 within two weeks without any external supporting news.