At new high price of $24 per coin, Chainlink volume now greater than Litecoin

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Chainlink has entered price discovery and traders should watch several key levels for the next possible top.

Chainlink (LINK) remains one of the highest performing cryptocurrencies in the last 12 months. As of Jan. 23, Connect is now larger than Litecoin (LTC) and now number seven at $9.2 billion in market capitalization, despite surpassing Bitcoin Cash earlier this week.

The Connect price rise also coincides with speculation this week that Grayscale is planning to introduce a Chainlink Confidence offering. This news event probably played a part in Chainlink rallying to fresh all-time highs, making LINK, once again, one of the highest performing cryptocurrencies.

What is the key support level?

LINK/USDT 1-day chart. Source: TradingView

The daily Chainlink chart reveals huge uncertainty in recent months, but also some beautiful market action.

Any previous degree of resistance has moved to help, during which the price has started to increase almost in textbook fashion. That’s the magic of price action and trade in general.

Many people have the desire to enter a place when the price is soaring. But the support/resistance flips really offer the best entries. Specifically, the first support/resistance flip occurred at the $10 mark, in which the same thing happened in $13 and $17.30 zones.

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The key level to watch for potentially further downside is the $17.30 location, as well as the $19.50 range. This latter field is the former all-time high in 2020 and probably the next support/resistance flip, which will be further upside down.

Possible Chainlink price tops to watch

LINK/USD 1-day chart. Source: TradingView

Since Chainlink is in price exploration, it becomes difficult to identify the next points of concern for future top structures. However, the Fibonacci extension method is very useful for traders to define these zones.

Using this measure, the first zone is between $29-31, which suits all Fibonacci extensions. The second zone is the $2,618 Fibonacci extension of $39, and the third zone is the $42 zone.

However, the next impulse wave is expected to see a strong spike in the Bitcoin (BTC) Connection pair. Bitcoin spearheaded the recent rally, while the altcoin-BTC pairs were comparatively down.

When Bitcoin ends its correction and begins going up slowly, the probability of altcoins outperforming Bitcoin rises.

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LINK/BTC meets big resistance zone

LINK/BTC 1-day chart. Source: TradingView

Altcoin-BTC pairs have woken up from their deep sleep in the past few weeks, but it can’t really be considered a “altseason” just yet. Altcoins will have to consolidate and build up momentum for the next leg.

For Chainlink, this concentration is seen on the left side of the map. Chainlink’s price has been in the concentration zone for some time since the current surge begins to occur.

In order for such a massive spike to occur, the price of Bitcoin must stay stable. Otherwise, the instability of the BTC would have a much stronger effect on the less-liquid altcoins.

LINK/BTC is now faced with critical opposition. If this stage at 0.00074000 sats cannot be broken upside down, re-tests at 0.00055000 and 0.00041000 sats are possible.

However, if Chainlink splits through 0.00074000 sats, it is likely to continue into the next important zone at 0.00110000 sats. In the USD pair, this spike will bring Chainlink next to the next Fibonacci region at $39.

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The views and opinions expressed here are solely those of the author

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