Cryptoclump: ChainLink (LINK) in an Unfortunate Downward Trend?

The well-known oracle for digital assets continues to grow as the months go by. But like the rest of the market, the price keeps falling. In the context of strong sales pressure, which is explained by the current macroeconomic context, will the decline then continue over the next few months? Let’s move on to the charts to try to establish the most likely scenario for the coming months.

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An asset back to 2020 levels?

LINK price against dollar on weekly basis

After a record high of $ 53 in May 2021, the asset has been in a weekly downward trend. By closing twice below the $ 33 range, the latter acted as resistance. A sales force has emerged with an acceleration of downtrend. You can see this with the oblique resistance, which materializes the formation of downward peaks.

Following the bearish outburst of support of $ 12, LINK moved fairly quickly to another support zone, where it had recorded lows several times during the year 2020. Now it remains to be seen if this level could let go by letting the asset continue its fall.

As we are currently in a downward trend, the probability of an outbreak of current support should be considered with a return of at least $ 4.85. This level, equivalent to a resistance in 2020, was never retested after its eruption. So in the event of a breach of current support, investors must cross their fingers that the price will react here.

LINK cryptocurrency price against dollar on daily basis
LINK price against dollars on a daily scale

What we can see now is the rapid reintegration, on a daily basis, of the daily key level after a major liquidation. Although the trend is bearish, if bitcoin does not decide otherwise, we may see an upward correction from the current downtrend.

What do I mean by that? After the sharp fall in the markets, we need to have a correction of this trend in mind in order to come and seek the remaining liquidity. As it stands, keep an eye out for a close above $ 7.97 on LINK, a level that is currently resisting in H4. In the event of a favorable daily close, we may choose a return on the daily liquidity gap ($ 9.31 to $ 9.85).

The best case scenario for this correction would be for the price to return to the supply zone (at least $ 11.10) to close the remaining orders. Moreover, this zone converges with a dual technical zone that acts in favor of the sellers as resistance. Note that in the current context, a LINK that closes well above $ 12 to reverse the downward trend would be overly optimistic. Therefore, the positive objectives that I recall are against the trend, must remain reasonable.

LINK price against bitcoin on a weekly basis
LINK price against bitcoin on a weekly basis

Sometimes it seems to me interesting to do an analysis against bitcoin. Why ? It was the old unit of measurement for altcoins before stack coins came on the market. On the chart you can quite easily see the trend change. After a bullish period from August 2018 to December 2020, LINK is now in a bearish trend towards bitcoin. You can see this trend with declining lows and highs.

What is the plan for the future? If the current level drops to 2427 satoshis, LINK will continue to underperform against bitcoin. This will mean a probable return to 1545 satoshis. In fact, the trend may even continue for many months with a return to 830 satoshis and 579 satoshis. Of course, don’t worry, we’re not there yet.

The purpose of this LINK / BTC section is to highlight the token’s underperformance vis-à-vis the king of cryptocurrencies. So what to deduce? If bitcoin falls, LINK will be the first to be affected. But if bitcoin rises, the performance of LINK will not be great. This trend can be reversed if the asset manages to recover 3950 satoshis, a level similar to the previous weekly high.

Here we are at the end of the analysis of the LINK against the dollar and bitcoin. Currently, keep in mind that the king of oracles is underperforming against bitcoin and in a downward trend against the dollar. The macroeconomic background is clearly unfavorable for the expansion of digital assets. However, given the rapid downward trend over the last few weeks, we need to consider a potential reversal in the short term for an upward correction. Currently, the environment is uncertain. It is not impossible to obtain a decrease to the levels indicated in the analysis without making the expected upward correction.

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