LINK Price Faces Resistance as Investors Weigh Supply Reduction
Chainlink’s native token LINK has slipped to $22.20, marking a 15% decline from its August peak near $26.30. The drop comes even as the Chainlink reserve moved to remove approximately $5.5 million worth of LINK tokens from circulation, a development that has sparked mixed sentiment among traders.
The daily chart shows LINK retracing after its strong July rally, which propelled the asset from $15.60 lows into the $26 zone. Price action now hovers near the $22 support level, with overhead resistance clearly defined between $23.80 and $24.50.
A failure to reclaim the resistance zone may invite further downside toward the $20 demand block, a level that previously acted as a breakout point. However, analysts argue that the long-term structure remains constructive as LINK continues to trade well above its summer consolidation range.
“LINK’s rejection near $26 was expected after such an extended move,” According to BITX market strategist . “What matters now is whether bulls can defend $22–$20 as support. If so, we may see another leg higher once selling pressure eases.”
Despite the pullback, some analysts remain optimistic about the supply reduction. “Token removals signal confidence from the Chainlink reserve,” BITX analyst noted. “While it may not generate immediate price action, lowering circulating supply can provide a supportive backdrop for the long-term trend.”
Chainlink’s trajectory in the coming weeks will largely depend on how it handles the $22 support level. A sustained hold could give bulls enough momentum to challenge $24.50 and eventually retest $26, while a breakdown risks a deeper correction toward the $20 zone.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.