Chainlink (LINK) has recently demonstrated significant volatility, showing both a sharp decline and a strong rebound. The price of LINK recently dropped to $13.18, a 13.6% correction from $15.25, following a high of $16.34. However, LINK quickly rebounded, recovering to $15.25 amid a broader market pullback, suggesting renewed investor confidence and possible institutional accumulation. The surge in wallet holdings and high-volume activity indicates a renewed interest in the asset, prompting traders and analysts to reassess LINK’s price trajectory.

Fibonacci Levels and Key Support

The market downturn for LINK, marked by a correction to $13.18, was followed by a rebound that found support at crucial Fibonacci retracement levels. The Fibonacci levels identified critical zones, including 0.236 at $14.17, 0.382 at $14.50, and 0.618 at $15.00. LINK’s movement through these levels will provide insight into the strength of its rebound. If the coin continues to hold support at these levels, particularly at $13.18, it could potentially strengthen LINK’s market position and reduce the risk of further declines.

A breakout above $15.00 would signal bullish momentum, while a failure to hold above this price could lead to a retracement back toward $14.50 or even lower levels. Historically, altcoins like Ethereum have seen similar pullbacks followed by price stabilization, suggesting that LINK could recover as well, especially if market sentiment improves.

Market Momentum and Indicators

LINK’s recovery to $15.25 has been accompanied by increased trading volume, reaching 25.137 million, well above the 9-day Simple Moving Average (SMA) of 12.568 million. Higher volume is often an indicator of a strong trend, suggesting that LINK could be primed for further upward movement. If the token can sustain volume above 25 million, the next target could be $16.34.

Several technical indicators support the argument for a continued rally. The Moving Average Convergence Divergence (MACD) indicator, which initially showed a bearish reading of -0.335 during LINK’s dip to $13.18, flipped to a bullish crossover at 0.145, confirming a shift in momentum. The widening histogram bars further indicate growing momentum. Similarly, the Rate of Change (ROC) climbed to 10.78, mirroring previous positive price momentum seen in February 2025, which led to further gains.

Open Interest and Sentiment Analysis

Open Interest (OI) has also provided valuable insights into market sentiment. LINK’s OI ranged from 4.597 million to 4.92 million, with a peak coinciding with the price rebound to $15.25. This suggests the formation of new long positions. On the other hand, the decline in OI to 4.59 million during the drop to $13.18 signals liquidations and the closure of positions, indicating market volatility.

Increased open interest at $15.25 points to bullish sentiment, as new positions indicate optimism. If OI continues to rise above 4.92 million, LINK could be propelled toward $16.34. However, if OI falls below 4.59 million again, the selling pressure could increase, potentially pushing LINK back to $13.00.

Cumulative Volume Delta (CVD) and Market Behavior

The Cumulative Volume Delta (CVD) reflects shifts in buying and selling pressure. During the drop to $13.18, the CVD fell from -3.7 million to -6.653 million, signaling strong selling pressure. However, as the price rebounded to $15.25, the CVD improved, suggesting a shift toward accumulation. A positive CVD move above -3 million could confirm bullish dominance, pushing LINK toward $16.34. Conversely, a drop below -6.653 million could reignite selling pressure, potentially driving the price back to $12.00.

Conclusion

LINK’s recent price action reflects significant volatility, with a 13.6% correction followed by a 15.8% rebound. The price movement suggests strong demand at critical support levels. If the momentum continues, LINK could reach new highs of $16.34-$17.00. However, traders and investors should monitor key indicators such as Fibonacci levels, open interest, and CVD to gauge whether the current rally is sustainable or if a retracement is in the cards. The next few days will be crucial for determining LINK’s medium-term price trajectory.