What's Behind the Chainlink Price Increase? | Credit: Derek Fenech
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Key Takeaways
Chainlink (LINK) is trading inside a descending wedge pattern.
The LINK price has bounced nearly 20% since its Jan. 13 lows.
Will LINK break out from its wedge and reach new highs in 2025?
Chainlink (LINK) was one of the first movers in the current bullish cycle alongside Solana (SOL). While it stumbled in the first half of 2024, LINK increased by 200% in November alone.
However, LINK struggled to start 2025 as it ended 2024 but has recovered admirably after the Jan. 13 decline.
Now approaching a 33-day resistance trend line, a breakout above it can confirm the Chainlink correction is over and lead to new highs in 2025. Let’s examine the charts and see how likely this is.
On Jan. 14, Chainlink revealed the CCIP v1.5 upgrade. The upgrade is mainly focused on allowing developers to deploy cross-chain tokens. It introduces the Cross-Chain Token standard, which gives developers full control and ownership of cross-chain tokens.
The upgrade will also include the CCIP Token Manager, an improved interface for launching and managing cross-chain tokens.
Chainlink community ambassador Zach Rynes tested and praised the upgrade. He announced the creation of a token in just a few minutes and transferred it from Base to Arbitrum.
In other positive news, Chainlink announced a partnership with BTguru to scale institutional adoption of tokenized securities in Turkey.
Chainlink Price Bounces
Chainlink’s price has fallen since its 2024 high of $30.94 on Dec. 13. The decrease is contained inside a descending wedge, considered a bullish pattern. Since the price is approaching the end of the wedge, an eventual breakout is the most likely future outlook.
The price action gives another bullish signal by preventing a breakdown from the $19.20 horizontal support area (white icon), creating a long lower wick in the process.
Technical indicators show bullish signs but not enough to confirm the breakout. While the LINK price still trades below the resistance trend line, the Relative Strength Index (RSI) has almost broken out from its resistance.
Additionally, the Moving Average Convergence/Divergence (MACD) shows that momentum to the downside is weakening (green), though the indicator has not made a bullish cross yet.
The four-hour chart aligns with this positive outlook, giving three bullish signs.
The price reclaimed the minor $20.50 horizontal support after deviating below it (black circle). Secondly, it broke out from a descending resistance trend line that had existed since Jan. 6.
Finally, the four-hour MACD has generated a bullish divergence (green) and moved into positive territory.
So, Chainlink’s price action and indicator readings suggest a breakout from the wedge is the most likely future outlook. If that happens, the wave count can help determine the next targets.
Breakout Ahead
Chainlink’s wave count shows that the decline since the 2024 high is part of wave four (white) in a five-wave upward movement.
The correction is a textbook fourth wave pullback, bouncing (white icon) at the resistance trend line of an ascending parallel channel connecting waves one and two and validating the 0.618 Fibonacci retracement support level (yellow).
If the count is accurate, Chainlink’s price has started its fifth and final wave and will confirm it with a breakout from the descending resistance trend line.
The first target for the top of the increase is between $36.53-$38.38. The lower range of the target is created by giving wave five 0.382 times the length of waves one and three combined. The 1.61 external Fibonacci retracement of wave four creates the upper limit.
Chainlink showed resilience by recovering all of its losses on Jan. 13 and reclaiming a lost horizontal support area.
Chainlink can confirm its bullish trend by breaking out from a descending resistance trend line, starting the fifth and final portion of its long-term upward movement.
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.
