Chainlink's Stability at $12.5: Can LINK Avoid a Deeper Drop?

The cryptocurrency market is currently under a cloud of fear, affecting the performance of Chainlink (LINK). Despite this challenging atmosphere, LINK is trading at approximately $12.5, with significant buying activity preventing a drop below this critical support level. While Chainlink shows steady on-chain usage, trading momentum has stalled.

Key Takeaways

The cryptocurrency market is facing fear-driven conditions, impacting Chainlink's price.
Chainlink's Total Value Secured (TVS) increased to $46.03 billion, indicating stable on-chain activity.
LINK is holding around $12.5, where buying pressure is preventing a deeper decline.
Whale activity on exchanges, particularly Binance, shows significant withdrawals, hinting at accumulation.
A crucial support zone exists between $12 and $12.5, while $27 is identified as a major resistance level.

Chainlink whales load up 445,779 LINK—Will $12.5 support hold?

Chainlink's Market Performance Amid Fear

The overall cryptocurrency market is experiencing a period of fear, which is reflected in the performance of Chainlink. Retail trader activity remains low as volatility decreases across key altcoins, causing LINK to settle into a consolidative price range.

Currently, Chainlink's Total Value Secured (TVS) has risen to $46.03 billion, marking a 2.43% increase month-over-month. This metric suggests consistent on-chain engagement, despite the flat price movements not indicating a clear market direction.

As of the latest updates, Chainlink (LINK) is trading close to $12.5, with selling pressure stabilizing across market sessions. Buyers have shown strength by defending the $12.5 support zone, preventing the price from dropping into lower demand areas.

Stalled Momentum Following Wedge Breakout

Earlier, Chainlink broke out of a falling wedge pattern on the daily chart, shifting the market structure from a downward trend to a consolidative phase. However, there hasn’t been significant follow-through buying following this breakout.

Link Price Chart
Source: TradingView

Momentum indicators are revealing short-term weakness. Notably, the daily MACD has formed a death cross, indicating bearish momentum. Additionally, the RSI has shown a bearish divergence, suggesting that buyers may be losing strength.

Influence of Whales on Binance

Recent whale activity has been notable, particularly with large withdrawals from exchanges. On December 20th, a new wallet took out 199,520 LINK from Binance, amounting to around $2.49 million. This transaction happened while LINK was stabilizing near its support level.

The following day, this same wallet withdrew an additional 246,259 LINK, valued at approximately $3.08 million. After these transactions, the wallet's total LINK balance reached 445,779 tokens.

Exchange Outflows Indicating Accumulation Phase

Data from CryptoQuant indicates a decline in LINK supply on exchanges, which typically suggests accumulation rather than distribution in the market. This trend contrasts with spikes in deposits driven by panic selling.

Chainlink Exchange Outflow
Source: CryptoQuant

Similar patterns of exchange outflows were seen during 2019–2020, leading up to the market's expansion in 2021. A comparable structure has again appeared from 2022 to 2023, preceding rally indicators for 2024. In 2025, the observed outflow patterns echo these earlier phases.

Can LINK Maintain Critical Support Despite Market Caution?

The price range between $12 and $12.5 serves as a vital structural support for Chainlink. It is essential for bulls to sustain this area to uphold the current consolidation structure. If this support fails, it could result in a drop towards the $9 to $10 demand area.

Conversely, the price resistance remains at $27. A decisive movement above this level could unlock higher price levels. Until then, the price action for LINK is more likely to favor consolidation rather than significant expansion.

Final Thoughts

As the cryptocurrency market navigates through fear-driven conditions, Chainlink's ability to hold onto critical support levels will be crucial for its future price movements. Cryptographic enthusiasts and market participants should closely monitor these dynamics as they could indicate potential shifts in market behavior.