As the cryptocurrency world approaches the weekend, it has given mixed signals after the ‘explosion’ in the middle of the week. Chainlink (LINK) on the other hand, he was trying to stay away from this scenario and try to open a different path.
Bitcoin’s recovery above $42,000 this week has been positively received by the cryptocurrency market and has helped altcoins rise as well. LINK, on the other hand, preferred a different path instead of experiencing an uptrend after this recovery.
Chainlink (LINK) price, corrected sharply by 16% as markets rallied and continued to follow the 20 (red) and 50 (yellow) SMAs. However, a buy signal on the MACD and a significant improvement in the RSI showed that the LINK bulls are ready to move forward.
At the time of writing, LINK is trading at $25.57, up 4.66% in the last 24 hours.
Chainlink 4-Hour Chart
LINK’s correction didn’t seem to be as alarming as it seemed after taking into account the 51% price increase from Jan 1-10. Such an erratic price increase in a short period of time is often followed by a series of profit making processes. In fact, dips are significant as they lead to more organic growth after getting rid of weak sellers and reintroducing new longs into the market.
Similarly, LINK once again looked positive after holding support around $24. The support zone was also significant as it coincided with the daily 50-SMA (not shown). Once some short-term woes are overcome at the 4-hour 20 (red) and 50 (yellow) SMAs acting as resistance, LINK should be ready to move further 10% and revisit the high at $28.7. If a binary setup is avoided, LINK’s next touchpoint will be between $32-$33 followed by $36.5.
Meanwhile, a lower low below $24 might delay this bullish scenario. The 4-hour 200-SMA (green) will then become a crucial recovery point. The bullish thesis just described will be invalidated if the price drops below the $16.7-17.2 demand zone.
Indicators
LINK’s MACD responded to the recent correction by establishing a bullish cross below the half line. An early buy signal will generate more interest for LINK, but some may be safer to invest once the index is above equilibrium.
Meanwhile, the RSI was ready to tackle the downtrend after breaking into the resistance trendline. It may be important to wait for more buyers to enter the market when the RSI breaks above 55-60.
As a result chainlinkIt prepared for its next leg after providing support at $24 and the daily 50-SMA (not shown). Buy signals on the MACD and RSI further supported the bullish argument.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.