Crypto analyst Ali Martinez highlighted three key risk signals for Chainlink ($LINK), which has recently experienced a strong surge. According to Martinez, technical indicators, weakening activity from large token holders, and an increase in token inflows to exchanges raise the probability of a short-term slowdown in $LINK's price growth.
According to the analyst's data, the first warning came when the TD Sequential indicator on Chainlink's weekly chart generated a sell signal. This signal appeared after the price of $LINK jumped from around $7 to $13.77, gaining about 95 percent. Martinez noted that such a sharp increase could raise the risk of users taking profits.
The second notable event was a decline in trading activity by large investors. The number of large $LINK transactions exceeding $1 million decreased from about 59 to around 10 over the past two weeks. Martinez stated that this decline indicates a significant reduction in large investor participation in the market.
The third risk signal is the inflow of $LINK to exchanges. According to data, approximately 1.75 million $LINK were deposited onto exchanges, increasing the total $LINK balance on exchanges from 269.25 million to approximately 271 million. This increase in exchange balances is interpreted as a sign that some investors may be preparing to sell.
Martinez stated that when considered together, these three indicators create the possibility of a short-term correction or a period of sideways price movement for Chainlink stock following its recent sharp rise.
*This is not investment advice.
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