The return of this cohort of investors could be key to Chainlink price rallying to $10

Chainlink price has been struggling to mark a recovery since the FTX collapse, even when most of the other altcoins have reclaimed the losses of this duration. A key factor behind this slow recovery has been the lack of confidence noted at the hands of investors, which might be changing going forward.

LINK holders make a return

The presence or absence of long-term holders (LTH) is considered to be an important indicator of the confidence a cryptocurrency holds for its investors. In the case of Chainlink, this confidence could be seen wavering following the collapse of the cryptocurrency exchange FTX back in November 2022.

The LTH addresses observed a consistent decline, and within three months, this cohort contracted by more than 17%. Declining from 524,000 addresses, the network had about 430,000 addresses by the beginning of February this year, still holding on for more than 12 months.

Chainlink long-term holders (Hodlers)

The recovering market is gradually restoring the lost confidence noted in the lack of decline since the last month.

A rise in confidence is key when it comes to drawing investors and traders toward an asset. LINK could observe a recovery if bulls take control of the momentum, which would push the price back up.

Chainlink price aims at $10

Chainlink price rose by nearly 24% in the span of 12 days to trade at $7.602 at the time of writing. Currently, the altcoin is trading right above the 200-day Exponential Moving Average (EMA) line, which, if it crystallizes into a support floor, would aid recovery for LINK.

The Relative Strength Index (RSI) indicator is also in the bullish zone presently, suggesting room for more increase in price before touching the overbought area above 70.0. The Parabolic Stop and Reverse (SAR) indicator is also highlighting an active uptrend that would sustain if the Chainlink price keeps above the support level at $7.401.

This would enable LINK to initiate a rally and breach the critical resistance level at $8.271. Rising above the same would place Chainlink price at year-to-date highs and provide bulls an opportunity to push the coin to test the upper limit of the consolidation channel between $9.333 and $5.435. Breaching the same would propel the altcoin toward $10, marking a ten-month high.

LINK/USD 1-day chart

However, a rather unlikely pullback could result in LINK testing the critical support at $6.942. Losing the same would invalidate the bullish thesis and bring Chainlink price down to March lows of $5.903.