Chain link (LINK), one of the major players in the decentralized finance space, is currently facing increasing bearish pressure in the market. While LINK is bearish momentum continues to grow, key technical indicators signal the potential for further losses towards the critical $12 support level for the cryptocurrency. With this current price movement, Chainlink could continue to decline, potentially testing lower support levels in the near future unless there is a significant turnaround in market sentiment.
This article provides an in-depth analysis by evaluating current market sentiment surrounding Chainlink, examining key technical indicators and identifying critical support levels along with their implications for LINK price stability.
At the time of writing, it had a market capitalization of over $7.7 billion and a trading volume of over $243 million. LINK fell 3.75% to trade at around $12.82. Over the past 24 hours, both the asset’s market capitalization and trading volume have fallen by 3.72 and 1.67 respectively.
Assessment of current market sentiment surrounding Chainlink
Given the asset’s price movements, it appears that current market sentiment around LINK is still negative. The price is currently actively trading below the 100-day Simple Moving Average (SMA), towards $12 on the 4-hour chart. This suggests that the bearish trend could continue. With more selling pressure, this position indicates that Chainlink is likely to fall further as long as it remains below the SMA.
The 4-hour Relative Strength Index (RSI) signal line has successfully fallen below 50% into the oversold zone. This suggests that selling pressure is increasing and the asset may experience further downward movement towards the $12.44 level.
On the 1-day chart, LINK’s market sentiment is also negative, with the price trading below the 100-day SMA. LINK is showing a bearish trend as it moves towards the $12.44 support level after forming two bearish candlesticks. If the price falls below this key level, it could signal further bearish momentum and potentially drive the price towards other support levels.
Finally, the 1-day RSI has also fallen below 50%, further supporting the possibility of further price decline. This decline suggests that bearish pressure increases because sellers are still active and influential in the market. The fact that sellers are still active implies that LINK will likely continue to decline.
Identify critical support and resistance levels
Chainlink is currently on a bearish path, heading towards the $12.44 support level. If the price breaks and closes below the $12.44 support level, it could continue its bearish move towards the next support range at $11.10 and possibly even lower levels.
However, if the digital asset encounters resistance at $12.44 and fails to do so pause below, this could lead to a potential upside move reaching the $15.25 resistance mark. Should the price rise above this level, continue profits could occur, targeting the $17.96 resistance point and beyond.
Featured image from YouTube, chart from Tradingview.com