Here's Why a Chainlink Rally is Imminent | Credit: Veronica Cestari
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Key Takeaways
Chainlink (LINK) created a bullish engulfing candlestick.
The LINK price broke out of a descending parallel channel.
Is the Chainlink correction over, and will the price reach new highs?
Chainlink (LINK) shows renewed strength after a lengthy consolidation period.
The recent price action has reignited bullish sentiment, supported by the wave count and momentum readings.
This article delves into Chainlink’s technical analysis and wave structure that could pave the way to new highs.
Chainlink’s Bullish Candle
Chainlink has consolidated sideways for over a year, bouncing between an ascending parallel channel’s support and resistance trend lines.
More recently, the LINK price created a bullish engulfing candlestick (green icon) in the final week of June, preventing a breakdown from a channel.
Besides creating a bullish candlestick pattern, the Chainlink price started a rally that has nearly caused a breakout from a vital resistance trend line.
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If successful, LINK will likely increase to the channel’s midline at $22 and to the resistance at $33.
Chainlink’s wave count is also bullish since it shows an A-B-C correction with waves A and C having the same length.
The fact that the structure is a running correction, meaning that wave C does not fall below the termination point of wave A, reinforces the bullish Chainlink prediction.
Despite all these bullish signs, momentum indicators break the trend with a neutral outlook. The Relative Strength Index (RSI) is at 50 while the Moving Average Convergence/Divergence (MACD) is slightly below 0.
Even though the indicators trend upward, they have yet to confirm the trend reversal.
Therefore, the weekly time frame LINK prediction is cautiously bullish, but lacks confirmation for a decisive forecast.
Chainlink Breaks Out
The daily time frame LINK analysis creates even more optimism than the long-term one.
The wave count is the main culprit for this bullish Chainlink prediction.
After completing a five-wave increase (green), LINK finished a W-X-Y correction (red), which retraced to the 0.854 Fibonacci level.
The shorter-term two-hour analysis is the most bullish out of the three LINK charts, showing a pattern of vertical accumulation.
The pattern is eerily similar to the weekly LINK chart, but the latter still lingers at the channel’s support.
If Chainlink breaks out from the channel as expected, it will confirm the start of its upward trend that could take it to new highs.
Significant Rally Awaits
Chainlink’s technical analysis shows bullish signals across all major timeframes.
With a breakout from a descending channel and bounce at crucial Fibonacci levels, LINK is positioned for a potential rally toward $22 and possibly $33.
However, Chainlink lacks confirmation from momentum indicators to validate the bullish trend reversal.
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.
