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The recent rise of Bitcoin above $42,000 has gotten a lot of attention. While the crypto-limelight is focused on Bitcoin (for obvious reasons), some of its lesser-known counterparts have actually seen greater percentage gains in the last week. In fact, some of these are also appealing investment options.
Chainlink, for example, had the highest weekly percentage gainer among the top 50 altcoins by market cap, gaining nearly 25%. While the alt appeared to be well-positioned for the week, a critical resistance level could stymie its ascent in the coming weeks.
Chainlink Daily Chart
The recent rally in LINK has resulted in some significant developments over the last few days. For example, on the back of BTC’s rebound from $30,001, the price closed above its daily 20-SMA (red) and 50-SMA (yellow) for the first time in over two months. In addition, the price closed above its 19 May low of $21, which served as a resistance level.
The next target was now at the 23.6 percent Fibonacci level of $23.94 – a region that also coincided with the POC of the Visible Range. This is where sellers can react to LINK’s current trend and halt its upward trajectory. The 4-hour chart (not shown) was already displaying signs of market selling pressure.
Observers must now maintain a close eye on the $21-$21.3 support level over the coming days as it also coincided with the weekly 50-SMA (not shown).
The Relative Strength Index reversed in the overbought zone, but bulls remained in control as the index remained above 60. The +DI of the Directional Movement Index remained above the -DI, but it did experience a slight downtick as a result of some selling pressure. As buying pressure remained consistent, the MACD line rose above the half-line for the first time in over 60 days.
While the bulls maintained their dominance, it appeared unlikely that LINK would immediately break above $23.9, especially given BTC’s current retracement. LINK could settle between $21-$23.9 before the next leg upwards until buyers return to the broader crypto-market. Once LINK successfully closes above this upper limit, long trades can be set up.