Technical Analysis: Chainlink (LINK) Has Recovered To Key Support, Here’s The Next Target
Chainlink (LINK) has reclaimed an important support level, and the price is expected to continue rising in the near future.
Chainlink (LINK) has been trading below a descending resistance line since reaching a high of $39 in November 2021. During this time, the price hit a low of $5.3 in June 2022.
Since then, Chainlink (LINK) has been trading within a range of $5.3 to $9.5. The price has tested both the support and resistance of the range several times.
After bouncing up from the support of the range in early January, LINK broke above the descending resistance line and confirmed it as support last week (green arrow). This indicates that the long-term downtrend has ended.
The weekly RSI indicator has generated a significant bullish divergence (green line) prior to the entire upward movement, and the divergence line is still intact. Therefore, LINK is likely to continue rising to $9.5.
Breaking above this range could help the price rise to the next resistance level at $18.
Reclaiming an important price level
After being rejected at $8.3, the LINK price fell below the important support level at $6.4. However, this turned out to be a deviation as the price quickly recovered and confirmed this level as support on March 13. Such deviations often lead to a strong upward movement.
In addition, the price has also broken above the short-term descending resistance line and confirmed it as support on March 18.
Therefore, LINK is likely to continue rising to the recent high of $8.3 and even higher to the top of the range at $9.5.
Overall, the most likely prospect shows that LINK will continue to rise in the near future. The nearest targets are found at $8.3 and $9.5.
This view will be invalidated if the price breaks down below the support level of $6.4. If so, LINK could quickly drop to $5.3.
Disclaimer: Please note that this article is for informational purposes only and should not be taken as investment advice. As an investor, it is important to do your own research before making any decisions. We are not responsible for any investment decisions you make based on this information. Not Financial Advice.
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