Key takeaways
What does the sharp drop in Chainlink currency reserves indicate?
It signals strong accumulation and long-term holding behavior, reducing the supply of liquid and increasing the upside potential.
How are traders responding to LINK’s tight offering structure?
Futures data shows dominance of buyer buying, revealing growing optimism and positioning for a bullish breakout.
Since January, chain links [LINK] Foreign exchange reserves have plummeted from over 180 million LINK to approximately 146 million, a reduction of 34 million that reveals aggressive accumulation among investors.
Over 15 million LINK have been withdrawn in the last 30 days alone, reducing the proportion of supply held on exchanges to around 15% of total tokens.
This continued bearish trend indicates a shift towards decentralized integrations, staking and long-term holdings rather than short-term speculation.
Historically, such steep outflows reduce available liquidity and often create a bullish structural setup as fewer tokens remain on exchanges to sell during corrections.
Consequently, the reduction in LINK supply strengthens the case for an eventual bullish move once market sentiment stabilizes.
Will buyers defend the $15.61 level?
At the time of writing, LINK was trading at around $16.17, reflecting a daily drop of 8%.
Despite the pullback, its broader trend structure remained technically controlled, forming a descending channel that guides the current price action.
Buyers have consistently defended the support at $15.61, preventing LINK from sliding towards the next important floor at $12.86.
The Parabolic SAR indicator held near $18.04, suggesting that a decisive push above it could spark renewed bullish momentum. The resistance levels of $19.14 and $23.79 will be key confirmation zones for a breakout.
However, as long as buyers keep the accumulation near the lower bound, the token’s consolidation may transform into a possible reversal base for the medium-term recovery.
Source: TradingView
Long-term accumulation
On-chain metrics revealed that LINK recorded a net outflow of $5.41 million on November 3, extending the steady accumulation trend seen since mid-year.
Foreign exchange reserves have fallen from 18% to 15% of total supply, showing growing confidence among holders moving their assets into staking contracts and cold wallets.
These persistent outflows often coincide with lower selling pressure and can form a bullish liquidity imbalance that supports price strength.
Historically, these structural supply reductions have preceded major rallies as circulating supply tightens while demand gradually increases.
This pattern reflects the accumulation phases of previous LINK cycles, where large holders capitalized on declines to shore up long-term positions.
Growing optimism among traders
The Futures Taker CVD (90-day) indicator confirmed a clear buying dominance of participants, indicating that market participants were favoring long exposure in derivatives markets.
This behavior revealed growing trader confidence, aligning strongly with on-chain accumulation patterns.
With buyers outnumbering sellers in futures activity, it reflects the belief that LINK’s current weakness could precede a trend reversal.
Furthermore, the synergy between spot accumulation and bullish derivatives data reinforces the broader positive outlook.
However, near-term volatility remains likely, as any dip in buying momentum could briefly test the market’s resilience before further gains emerge.
Still, the balance of evidence suggests that traders are preparing for a bullish phase.
Is a Chainlink supply squeeze happening?
With buyers defending the $15.61 level and momentum gradually shifting, a break above $18.04 could confirm a reversal targeting $19.14 and $23.79.
Although short-term volatility remains possible, LINK’s structure reflects accumulation strength beneath surface weakness.
Taken together, the data suggests that a rebound may be underway, driven by growing investor conviction and a shrinking exchange supply base.
