Chainlink Price Prediction: Will LINK Coin Rebound from a Failed Breakout?
The price of Chainlink’s native cryptocurrency, LINK, has struggled to keep up with the broader market’s recent recovery. After a failed breakout from a resistance level of $20.8, the price of LINK has dropped 7.7% over the week and is currently trading at $19.8. The question now is whether Bitcoin’s potential breakout from $70,000 will push the LINK coin back into a recovery trend.
A Cup and Handle Pattern Signals Major Uptrend
An analysis of the daily chart shows that the Chainlink price has formed a bullish cup and handle pattern during the recent recovery. This pattern is a well-known reversal pattern that indicates a transition from a downtrend to an uptrend, characterized by a U-shaped recovery.
On February 2nd, the price of LINK broke out from the neckline resistance of the cup and handle pattern, signaling an end to the nearly two-year sideways trend. This breakout led to a rally that pushed the price of LINK up by 23.7% to $21.6, a level not seen since January 2022.
However, the supply pressure at $20.8 has caused the recovery trend to stall and consolidate sideways. On March 5th, the Chainlink price experienced a rejection at the support level of $17.5, indicating that buyers were accumulating during the market dip.
Whales Bet Bullish with $16.72 Million LINK Withdrawal
Data tracker Lookonchain recently reported that eight new wallets have withdrawn 831,160 LINK tokens, worth approximately $16.72 million, from Binance in just two days. This significant movement suggests that whale investors are showing a strong interest in Chainlink, potentially indicating a bullish outlook for the cryptocurrency.
Despite the recent sideways price action, these large-scale transactions indicate strategic accumulation of assets, which points to a high potential for a renewed recovery trend. If buying pressure continues, the LINK price could reach the theoretical target of $30 suggested by the cup and handle pattern, representing a potential growth of 52%.
Technical Indicator
- Pivot Levels: According to traditional pivot levels, the LINK price may face overhead supply pressure at $21.7, $24.15, and $27.4.
- Moving Average Convergence Divergence (MACD): The bearish crossover between the MACD and signal line indicates that sellers are currently driving the price movement.
Despite these technical indicators, it’s important to note that cryptocurrency markets are highly volatile and subject to rapid changes. Therefore, it is always recommended to conduct thorough research and analysis before making any investment decisions.
In conclusion, while Chainlink’s LINK coin has experienced a setback with a failed breakout, there are still positive signs for a potential recovery trend:
- The formation of a bullish cup and handle pattern on the daily chart
- The withdrawal of a significant amount of LINK tokens by whale investors
If these factors continue to align favorably for Chainlink, there is a possibility that the LINK coin could rebound and experience significant growth in the near future.
Hot Take: Will Chainlink Overcome Resistance and Resume its Recovery?
The recent failed breakout from resistance has put Chainlink’s recovery on hold. However, several factors suggest that the LINK coin may overcome this obstacle and continue its upward trend:
- The bullish cup and handle pattern indicates a potential major uptrend
- The withdrawal of LINK tokens by whale investors suggests a bullish outlook
While there are technical indicators that point to potential resistance levels, it’s important to remember that market conditions can change rapidly. Therefore, it is crucial to stay informed and monitor the market closely to make well-informed investment decisions.
If Chainlink manages to break through the resistance level and resume its recovery, it could lead to significant price growth for the LINK coin. However, as with any investment, it is essential to exercise caution and conduct thorough research before making any financial decisions.
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