Chainlink (LINK) remains one of the best performing cryptocurrencies of the past twelve months. As of January 23, LINK now outstrips Litecoin (LTC) and is now number seven on a $ 9.2 billion market capitalization, having surpassed Bitcoin Cash earlier this week.
LINK’s price surge also coincided with rumors this week that Grayscale is preparing to add a Chainlink Trust product. This news event has probably played a part in Chainlink’s rallying price towards always new highlights, making LINK, once again, one of the best performing cryptocurrencies.
What is the key level of support?
The daily chart for Chainlink shows huge volatility in recent months, but also some beautiful price action.
All previous levels of resistance slipped for support, after which the price continued to climb almost in textbook fashion. That’s the wonderful nature of price action and trading in general.
Most people have the impetus to enter a position when the price soars. But those help / resistance flips really give the best records. Specifically, the first support / resistance flip occurred at the $ 10 level, after which the same happened with the $ 13 and $ 17.30 areas.
So, the essential level to watch for potential downside is the $ 17.30 zone, as well as the $ 19.50 zone. This latter area is the highest ever all-time in 2020 and possibly the point of the next support / resistance flip, which would be bullish for more upside.
Possible Chainlink price tops to watch
As Chainlink discovers prices, it is difficult to define the next interest points of the highest possible structures. The Fibonacci extension tool, however, is quite useful for traders to determine these areas.
Using this indicator, the first zone is between $ 29-31, which matches the two Fibonacci extensions. The second zone is a $ 39 Fibonacci 2.618 extension and the last one is in the $ 42 area.
However, the next impulse wave is likely to see a big surge in the Bitcoin (BTC) pair of LINK. The recent run was led by Bitcoin, while the altcoin-BTC pairs were relatively flat.
Once Bitcoin finishes its correction and begins to move up in a slow way, the likelihood of altcoins outperforming Bitcoin increases.
LINK / BTC meets great resistance zone
The altcoin-BTC pairs have been waking up from their deep slumber in recent weeks, but it cannot yet be called an “altseason”. Altcoins must continue to consolidate and build strength for the next clause.
For Chainlink, such accumulation is shown on the left side of the chart. Chainlink’s price has been operating in an accrual range for some time before the latest surge began.
For such a large surge to occur, the price of Bitcoin must remain constant. Otherwise, the volatility in BTC will have an even greater impact on the less liquid altcoins.
LINK / BTC now faces vital resistance. If this level at 0.00074000 sats cannot break down, then refreshed tests at the 0.00055000 and 0.00041000 sats levels are possible.
However, if Chainlink breaks through 0.00074000 sats, there is likely to be a continuation towards the next significant zone at 0.00110000 sats. In the USD pair, such a surge would put Chainlink close to Fibonacci’s next zone at $ 39.
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