![Chainlink Builds Solid Demand Between $14.8 And $15.2, LINK Could Hit This Price Level With The Lack Of Resistance](https://captainaltcoin.com/wp-content/uploads/2023/10/Copy-of-P2P-Review-18-2.png)
Chainlink’s LINK token has seen a remarkable rally over the past month, surging around 30% to current levels around $8. However, data suggests the rally may be overextended and LINK could be due for a correction soon.
According to analytics provider Santiment, Chainlink’s 30-day MVRV ratio recently surpassed 20%. The last two times this ratio reached these levels, LINK underwent steep corrections, according to top analyst Ali. The MVRV ratio compares LINK’s market value to its realized value, acting as a sentiment indicator. High values suggest overextension.
![](https://captainaltcoin.com/wp-content/uploads/2023/10/image-16-1024x486.png)
In addition, LINK is approaching a key resistance zone around $8.50, which aligns with the highs from April and July. This area marks a reversal point where previous rallies have stalled out. The confluence of overbought signals and nearby resistance suggests LINK could be primed for a pullback.
On the daily chart, the recent rally in LINK appears exhausted, as shown by the bearish divergence between price and the RSI oscillator. This bearish setup would be confirmed by a break below the 21-day exponential moving average, which would open the door to a retest of support around $6.
To sum up, while Chainlink has seen impressive gains lately, multiple signs point to an overextended rally that is likely to reverse. LINK could be poised for a deeper correction of 30-40% in the near-term before finding support. Risk-averse traders may look to take profits or hedge long positions at current levels before the pullback plays out.
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