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LINK coils up for a 25% drop - Faicy

News & Analyses

LINK coils up for a 25% drop

  • Chainlink price is trading within the lower segment of the ascending channel, thinly holding above $16.86.
  • LINK could drop 25% to $13.08 if markets show weakness.
  • A break and close above $20.70 would invalidate the bearish thesis.

Chainlink (LINK) price has consolidated within a range for the past two months amid a prolonged altcoin lull as Bitcoin (BTC) price bullish momentum stalled. With reducing trading volumes, volatility increased, causing LINK price to fluctuate.

Also Read: Chainlink price could rise 45% after sustained support-resistance flips as LINK sentiment changes

Chainlink price calculates a 25% breakdown

Chainlink price is likely to fall 25% to provide another buying opportunity at $16.86 as the Bitcoin price remains below $69,000 meaning the upside potential remains in the balance. With this level of uncertainty, altcoins could still drop, with Chainlink price eyeing a breakdown of the $16.86 support.

The Relative Strength Index (RSI) is dropping, moving below the 50 mean line and accentuated by the Awesome Oscillator (AO) indicator, which is in negative territory. With these pointing to a growing bearish sentiment, Chainlink price could make a 25% drop to $13.08.

In a dire case where the aforementioned level fails to hold as support, the LINK price could descend for a sweep of the liquidity resting below $13.08 before a potential move north.

LINK/USDT 1-day chart

On the other hand, a recovery that sets LINK price above $18.32, effectively meaning that $16.86 holds as support, could encourage more buy orders. A flip of the midline of the channel into support at $20.70 could precipitate a full-swing recovery rally, with the Chainlink price likely to make a run-up to the $28.71 target objective. 

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