With a YTD return of 176 per cent, there can be no doubt that Chainlink is one of the big-cap coins that has performed exceptionally well over the last few weeks, with forecasts of further highs to come. In fact, while LINK climbed to a local high near $36, it later poured some of its value on the price charts.
Furthermore, while the $32 level of support was once again large for LINK, it is likely to hold against the sale of the last few hours.
Chainlink 30-minute chart
Using the Fibonacci Retracement tool to move LINK from $22.9 to $35.74, some levels of retracement can be highlighted as potential levels of support. Over the past few days, the $32.18 level, which represents the 23.6 per cent retracement level, has been both supportive and resistant in the charts.
At the time of writing, LINK was once again approaching this level to re-test it as support.
Last week, losing this level and retesting it as resistance saw the next retracement level at $30.15 tested as support. LINK has recovered from such a situation, but it is a pattern that could still be repeated.
The RSI dipped below 50 and tested it as a resistance. The MACD formed a bearish crossover above zero and a dove southbound along the RSI.
This suggested that the short-term momentum shifted in favour of the bears of the market. Thus, while the long-term market outlook is buoyant, there is still a potential for a small drop back to $30 for LINK.
In longer timeframes, LINK still seemed to retain some buoyant momentum. The price response at $32.18 will therefore be crucial in the short term. A bounce off this level in the next few hours would indicate that a move upward is imminent while losing this level to bears would see LINK drop to $30.
In the event of a drop, the range of $30-$30.4 may be considered as a region of demand. However, the defence of the $32.18 level, which is more likely to be based on the momentum behind LINK since its recovery from $30, would indicate the strength of the bull.
LINK’s market bulls would have to drive the price higher than the previous high at $33.6 to break the short-term pull that Chainlink has been on since the 14th. Such a move backed by significant trading volume would likely lead LINK back to a high of $36.
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