Can Chainlink’s bullish indicators rekindle positive price action?

• Chainlink has moved up among projects with the highest development activity this month.
• LINK is changing hands near $12.30 – a height that acted as crucial support earlier this year.

Chainlink [LINK] has been one of the trending crypto projects this year, propelled by the hype around tokenizing real-world assets. Tokenization allows physical assets to be mapped, stored and traded a blockchain.

Through this conversion, illiquid assets like real estate can be able to attain liquidity.

Chainlink’s oracle services play a crucial role in RWA tokenization by providing reliable data feeds between the underlying assets and decentralized applications. This prevailing tokenization narrative has gained even more momentum in recent months, bolstering LINK’s value proposition.

RWA tokenization as a bullish driver

In a recent post on X, Chainlink cofounder Sergey Nazarov reasserted his belief that asset tokenization will transform the Web3 industry.

Nazarov doubled down on his expectations that the value of RWAs is likely to exceed that of cryptocurrencies in the next few years due to value flowing in from traditional finance.

Nazarov’s bold projection was shared by Chainlink, which envisions rapid growth in tokenized assets, accelerated by adoption from the institutional side and favorable regulatory developments.

In a report providing an overview of the global tokenized asset market, Chainlink forecasted the market for tokenized assets to reach $10 trillion by 2030.

Chainlink is well-positioned to exploit this potential shift thanks to its cross-chain interoperability protocol (CCIP), which entered general availability in April 2024.

The open-source communication standard enables builders to develop secure applications that can transfer tokens, messages, or both across different chains.

Robust development activity

Chainlink has notably seen the second-highest development activity among blockchain projects in the last month, as per data from Santiment, up from fourth according to the preceding update.

Development activity is broadly viewed as a measure of the growth of a network, thus conveying an optimistic outlook for the project’s long-term potential.

Last week, the Chainlink non-circulating supply wallet unlocked 18.125 million LINK that was deposited into Binance.

The transaction marked the ninth unlock with onchain monitoring tool Lookonchain noting that 7 of these occasions were accompanied by a price rally roughly a month after unlocking.

LINK/USD technical analysis

Chainlink (LINK) is changing hands at a critical level of $12.30, down 18% year to date and more than 76% below its May 2021 high.

On the daily timeframe, LINK has been trading above a prolonged falling channel for the last 7 days after breaking out on 18th September. The LINK/USD pair has immediate and long-term support levels at $8.09 and $5.68, respectively.

Source: TradingView

The daily chart’s Moving Average Convergence Divergence indicator crossed the signal line on 10th September, suggesting bullish momentum. Consistent green histograms since the crossover further confirm the growing upward traction.

Outside the spot market, Chainlink’s open interest in futures markets has been trending upwards this month, signaling rising trader interest in the asset.

Source: Coinglass

CoinGlass data shows that the dollar value locked in open futures contracts tied to LINK has increased by 10.55% in the last 24 hours to 15.46 million LINK at press time.

Open interest in futures contracts often correlates with changes in speculative activity and expectation of a price movement.