Chainlink Price Shows Strength Amid Market Sell-Off
The 14th largest cryptocurrency, Chainlink, has quickly rebounded from the recent crypto market sell-off. While Bitcoin and other major altcoins experienced a correction, Chainlink managed to sustain its price above $14.2. The coin has even seen a 5% intraday gain and is currently forming an inverted head and shoulder pattern. This pattern suggests a potential bullish reversal that could push the Chainlink price past $20.
Expanding Channel Pattern Breakout Could Help LINK
- The breakout of the expanding channel pattern may help Chainlink escape market uncertainty.
- The 20-day and 50-day EMAs indicate a short-term sideways trend for the coin.
- The intraday trading volume for LINK is $745 million, representing a 41% increase.
Over the past two months, Chainlink has been trading sideways due to uncertainty surrounding the Bitcoin ETF launch. Although the coin has seen notable price swings, the lack of conviction from buyers or sellers has created indecisiveness among traders.
An analysis of the daily time frame chart reveals an expanding channel pattern formed during market uncertainty. This pattern indicates that the price behavior of Chainlink will fluctuate between two trendlines before experiencing a decisive breakout.
In early January, Chainlink witnessed a reversal from the lower trendline of the expanding channel pattern, resulting in a 30% upswing and a price of $16.39. Despite the recent market sell-off, the LINK price only dropped by 7% but managed to hold above $14.2.
According to IntoTheBlock, a whale investor recently took advantage of the price dip and invested $8.9 million to acquire 601,949 LINK tokens. This significant purchase was distributed across three new wallets, indicating confidence in Chainlink’s value.
Chainlink Price Potential for Uptrend
With renewed buying interest, Chainlink has seen a 5% increase in price and is currently forming an inverted head and shoulder pattern. This bullish reversal pattern suggests a shift in market dynamics and presents an opportunity for buyers to lead a significant recovery.
The current price of Chainlink is $15.2, and it needs to break the neckline resistance at $16.2 for a potential breakout. If this occurs, it could lead to a 15% recovery and push the price towards the channel pattern resistance at $18.5.
To confirm a sustained uptrend, it is crucial for Chainlink to break above this resistance barrier. Additionally, the suitability of the LINK price above the 100-day EMA indicates an overall bullish trend, and the bullish crossover between MACD (blue) and signal (orange) reflects a return of recovery sentiment in the market.
Hot Take: Chainlink Poised for Bullish Reversal
The recent market sell-off did not deter Chainlink from showing strength and resilience. With its sustained price above $14.2 and the formation of an inverted head and shoulder pattern, Chainlink is poised for a potential bullish reversal. The breakout of the expanding channel pattern, coupled with strong buying interest and confidence from a whale investor, further supports the case for an uptrend. If Chainlink can break above the neckline resistance at $16.2, it could see a significant recovery of 15% and potentially reach the channel pattern resistance at $18.5. The overall trend remains bullish, making Chainlink an interesting cryptocurrency to watch in the coming days.
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