The cryptocurrency market is in a difficult situation with Bitcoin (BTC) breaking all-time highs in a matter of days. This uptrend sparked enthusiasm across the board and allowed some other cryptocurrencies to post significant gains as well. Although this increase offers lucrative return potential, investors need to be careful. Because not all crypto assets are created equal. Expert Justinas Baltrusaitis researched three cryptocurrencies that may underperform in the coming weeks based on fundamentals. Here is the result, including the likes of LINK coin…
First coin on the list: LINK coin
Chainlink (LINK) stands out as an anomaly in the current market frenzy. Unlike most cryptocurrencies that are enjoying the success of Bitcoin, LINK coin price movement has deviated sharply. This weak performance is highlighted by two key trends: rapidly declining dormant circulating supply and record-low investor confidence. Data from crypto analysis platform Santiment reveals a significant decline in LINK’s 180-day dormant circulation supply between February 6 and March 3.
This metric tracks previously inactive coins, indicating a change in investor behavior. While the initial rise suggests accumulation or holding, the subsequent 87.68% decline on March 6 raises red flags. This sudden move by dormant LINK indicates a potential shift in investor sentiment, possibly towards selling. Further strengthening the concerns is LINK’s Weighted Sentiment, which has fallen to a new low of -1.265. This metric, sourced from Santiment, reflects the general mood on social media surrounding the token.
Current data points to the worst downward trend since July 2023. This negative sentiment, coupled with a diminishing dormant circulating supply, paints a bleak picture for LINK’s short-term prospects, potentially leading to a bearish or neutral outlook. At the time of writing, LINK is trading at $20.08, reflecting a weekly loss of almost 6%.
Consolidation creates uncertainty in VeChain
VeChain (VET) has established itself as a long-term winner, with an impressive 70% increase in the last 30 days. While this trend may be rewarding for early investors, the current price hovering around $0.04 points to a potential short-term bearish trend. This is further supported by weekly losses of roughly 4%.
Commenting on the X platform (formerly Twitter), crypto analyst VeFam emphasized that VET’s consolidation is below the $0.05 level. This consolidation signals indecision in the market and potentially leads to a breakout in either direction. However, traders need to be careful as false breakouts are common during consolidation, where prices rise briefly but fail to maintain momentum.
The end result of this phase could lead to increased volatility, making it vital for traders to evaluate the strength of any breakouts before entering new positions. Due to this ongoing consolidation and its unpredictable nature, VET is currently considered an asset to avoid in the short term. Patience is key and traders are advised to wait for a confirmed breakout or trend before making any strategic moves.
Injective: Innovation failed to spark rally
Injective (INJ) had a turbulent week and failed to capitalize on the broader market rally. Interestingly, INJ not only missed the market rally. It also continued to decline despite introducing inEVM, a new aggregation aimed at facilitating cross-chain compatibility between Ethereum (ETH) and Solana (SOL). cryptokoin.com As we reported, this innovation has been praised for its potential to enable true interoperability.
Given these contradictory developments, investors need to be careful with INJ. It is crucial to observe how the token reacts to the introduction of inEVM before making any strategic decisions. At the time of writing, INJ is sitting comfortably above the $40 support level and is currently trading at $42.
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