The present technology is directed to a system and method for application aware management and recovery of link failures resulting from excessive errors observed on the link. One aspect of the proposed technology is based on identification of link errors associated with application-specific data patterns traversing link. Other aspects involve corrective actions based on relocation or modification of specific application traffic to thereby alleviate the observed excessive link errors and prevent a link failure or shut down. Relocation may involve moving the source application to a different virtual machine/container/physical device or rerouting application traffic by updating relevant routing protocols. Modification may involve harmlessly changing payload data pattern to remove data-pattern dependent signal attenuation. Information corresponding to identified faulty payload data patterns and associated frame data quality parameters maybe stored and utilized to provide analytics evaluation of network wide physical resource issues that maybe affecting application traffic.