Chainlink bulls need to surpass a crucial obstacle in order to potentially achieve a 7% surge
The price of Chainlink has been trying to recover from recent losses over the past few weeks. Currently, Chainlink is trading below a crucial resistance level, which has resulted in the altcoin being rejected.
Over the last 24 hours, Chainlink has only appreciated by 0.4%, indicating that it has been consolidating. On the weekly chart, LINK has already increased by 1.8%. However, continued price consolidation could lead to the bears taking over the price entirely.
The technical outlook for the altcoin also indicates that the bears are in control as buying strength has been weak. Both demand and accumulation have remained low on the chart. As Bitcoin trades in the $27,000 price zone, major altcoins are also trying to move upwards on their respective charts.
If Bitcoin does not stabilize above the $27,500 price point, sellers may pull Chainlink down further, causing the price to drop. The market capitalization of Chainlink has declined, indicating that buying strength has remained low.
Chainlink Price Analysis: One-Day Chart
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At the time of writing, Chainlink (LINK) was trading at $6.60, but this price level has proven to be a strong resistance level for the altcoin. Despite this, the bulls have managed to prevent further price retracement. The overhead resistance for LINK is currently set at $6.80.
LINK has been trading between $6.20 and $6.80 in recent weeks. Breaking above the upper boundary of this trading range is crucial for LINK bulls.
If LINK fails to breach the $6.80 resistance level, the bears could dominate the market. If the price declines, the initial support level is $6.20.
Further downside movement could see LINK trading near the $6.00 price level. The trading volume of Chainlink in the last session was low, indicating a limited number of buyers in the market.
Technical Analysis For LINK
Chainlink (LINK) has faced difficulties attracting buyers during May and most of April. The Relative Strength Index (RSI) has consistently remained below the 50-level, suggesting that buyers have lost interest in LINK due to recent price rejections.
In addition, LINK has fallen below the 20-Simple Moving Average (SMA) line, indicating that sellers have been driving the price momentum in the market.
To regain bullish momentum, it is crucial for LINK to move above the $6.60 level, which would allow the altcoin to trade above the 20-SMA line.
Unlike other technical indicators, Chainlink (LINK) has shown the emergence of a buy signal on the daily chart. The Moving Average Convergence Divergence (MACD) has shown the formation of green histograms, suggesting the potential for bullish momentum to develop.
In addition, the Chaikin Money Flow (CMF), which measures capital inflows, has displayed a positive reading as it crossed above the half-line. These indicators suggest a possible shift in market sentiment, with increased buying interest and inflows into LINK.