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Here’s How High Chainlink Could Rally if Bulls Defend Key Support

Other 2020/10/16 01:00 by Cole Petersen

Chainlink’s price has been caught within a tight and prolonged consolidation phase throughout the past few days and weeks, with buyers and sellers being unable to gain any clear control over its mid-term outlook.

Its price action has been moving in lockstep with that of Bitcoin, signaling that it may be losing the independence that it has seen throughout the past few months.

It is important to note that LINK appears to be caught within an accumulation phase at the moment, as each dip is being aggressively absorbed, despite the lack of enough buying pressure to push it past its $11.00 resistance.

This trend bodes well for the cryptocurrency’s near-term outlook, as the price region just below where it is currently trading at may provide a strong base for it to grow upon.

One analyst is noting that he is setting his sights on a move towards $14.00 in the mid-term. He also adds that this may be an ideal region to short, as the resistance here is quite significant and will likely slow its ascent.

Chainlink Tracks Bitcoin’s Price Action; Enters Accumulation Range 

At the time of writing, Chainlink is trading down just over 2% at its current price of $10.70. This is around where it has been trading throughout the past several days, with buyers and sellers largely reaching an impasse.

Where it trends next may depend somewhat on Bitcoin, as the benchmark crypto has been firmly guiding major altcoins like LINK in recent weeks.

If this correlation continues holding strong, then Chainlink could be heavily exposed to any potential turbulence within the global markets.

That being said, the support it has established in the sub-$10.00 region is significant and may continue bolstering its price action.

Here’s Why LINK May Rally Towards $14.00 Next

There is a possibility that this ongoing accumulation phase will be followed by a strong uptrend.

One analyst explained that the $9.00 region will likely continue holding as a bedrock support level, potentially helping to spark an uptrend towards $14.00 if visited.

“The same idea stands on LINK. If we drop down, I’d be looking around $9 for longs on this one. Targets of shorts around $12-12.50 and $13.75-14.25,” he said.

Chainlink LINK

Image Courtesy of Crypto Michaël. Source: LINKUSD on TradingView.

Because Chainlink is now closely tied to the rest of the market, watching Bitcoin’s short-term trend shape up should provide some serious insight into where LINK will trend next.

Featured image from Unsplash.
Charts from TradingView.

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