Chainlink’s Network Growth at its Lowest Since October 2020 – Report
- Network growth on Chainlink is at its lowest since October 2020
- Fewer and fewer Chainlink addresses are interacting with the network
- Chainlink daily active addresses are at 5k compared to 13k in April
- There has been an increased inflow of LINK into crypto exchanges
- From a technical analysis point of view, Chainlink is in bearish territory trading below the 200-day and 50-week moving averages
Activity on the Chainlink (LINK) network is slowing down. This is according to a report by the team at Santiment who pointed out that Chainlink’s network growth was at its lowest since October 2020. Furthermore, fewer and fewer LINK addresses were interacting with the Chainlink network as highlighted in the following chart.
A Drop in Network Growth is Bearish for Chainlink
Unlike in October 2020 when the drop in network growth formed a bullish divergence with the price of Chainlink, the ongoing decline in activity could be bearish given that the price of LINK is also dropping. To further elaborate this point, the team at Santiment compared LINK’s active addresses in the last three months and found a significant drop as explained below.
LINK has dropped significantly in terms of average active addresses compared to spring. Just around 5K addresses daily are active on the network nowadays. From 13K in April.
Exchange Inflows of Chainlink Spiked in the Last Week
The bearishness surrounding Chainlink has also led to an increased transfer of LINK into exchanges for possible selling as highlighted in the chart below.
Chainlink’s Daily Chart Remains Bearish
In terms of price action, Chainlink (LINK) is currently trading below the crucial 200-day moving average and 50-week moving average as demonstrated in the chart below.
Also from the chart, it can be observed that a death cross between the 50-day MA and 200-day MA is in the process of forming. Therefore, Chainlink could be in for a rough few weeks in the crypto markets.
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