Can Chainlink's ETF Filing Trigger a Bounce? | Credit: Hameem Sarwar
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Key Takeaways
Bitwise filed for a spot Chainlink (LINK) ETF on Aug. 26.
The LINK price broke down from an ascending wedge.
Can the positive news lead to a Chainlink price bounce?
On Aug. 26, Bitwise filed for a spot Chainlink Exchange-Traded Fund (ETF). The ETF has been hyped since Chainlink has seen considerable institutional investment and is likely to do well with an older, retail audience.
Nevertheless, despite today’s positive news, the Chainlink price is down nearly 20%.
Considering that, let’s analyze the LINK price action to see if LINK can begin a bounce and mount a bullish trend reversal.
Chainlink created a higher low in June and then accelerated its increase in August, culminating with a high of $27.87 on Aug. 22.
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The Relative Strength Index (RSI) created a bearish divergence before the breakdown, and the Moving Average Convergence/Divergence (MACD) made a bearish cross shortly afterward.
If the decline continues, Fibonacci support will be at $21.40, and Fibonacci and horizontal support will be at $19.40.
Given the prior increase’s length and the retracement’s shallow nature, it is unlikely that the correction has already run its course.
Rather, the price of Chainlink may be working on wave A of an A-B-C correction structure (red), which will take it toward the Fibonacci and horizontal support levels outlined above.
The Fibonacci Time Zone tool projects that wave C will end between Sept. 10 and 25.
Since the two upward movements do not share common proportions, it is more plausible that they represent separate wave ones, which leans the analysis toward the bullish count.
Ultimately, whether the ongoing decline unfolds as a controlled correction or escalates into an impulsive drop will determine which of these outcomes materializes.
Positive News, Negative Price
Despite the positive Chainlink news today, its outlook is uncertain.
The short-term analysis predicts a drop to at least $21, but the long-term outlook is unclear.
Ultimately, the next few weeks will determine whether LINK regains its bullish trend or slips into a prolonged decline.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
