Chainlink has been under heavy selling pressure of late, with a 22% drop from its local supply zone to test critical demand around the $20 mark. Despite this decline, market sentiment around LINK remains positive as analysts and investors expect a strong recovery. Many see this pullback as a strategic opportunity to rally, with the potential for big gains later this year.
Related Reading
Lead analyst Carl Runefelt shared a strong technical analysis of X, indicating that LINK is currently trading within a falling wedge pattern on the daily time frame. Falling pieces are often seen as bullish reversal patterns, and a breakout above the downtrend may signal the start of a major uptrend. According to Runefelt, once LINK successfully breaks out of this formation, the stage will be set for a massive rally, which could propel LINK to new heights.
With strong Chainlink foundations and growing adoption of decentralized finance (DeFi) and blockchain ecosystems, the current price action could be the basis for significant gains. However, the immediate challenge is to regain lost ground and push above the resistance of the mountain. As the market waits for confirmation of a breakout, LINK's path in the coming days will be crucial in shaping its long-term trend.
Chainlink poised to recover after recent downturn
Chainlink has cemented its position as one of the most promising altcoins in this market cycle, standing out in the rapidly growing Real World Assets (RWA) sector. Its innovations and partnerships are driving wider adoption, especially with a groundbreaking collaboration with XRP. This partnership aims to improve the functionality and adoption of Ripple USD (RLUSD), a stable coin designed for decentralized finance (DeFi), making Chainlink a key player in the ecosystem.
Related reading: Whales Buy 470 Million Dogecoin in 48 Hours as Price Tests Crucial Demand Level – Details
Renowned investor and analyst Carl Runefelt recently shared a technical analysis of X, revealing that Chainlink is trading within a falling wedge pattern on the daily timeframe. This bullish reversal pattern indicates upside potential once LINK breaks above the bearish resistance. Runefelt has set an initial price target of $30.94 after the expected breakout, signaling the potential start of a larger bull move for LINK.
In addition to its technical position, Chainlink's strong fundamentals, including its leadership in Oracle solutions and its expanding influence in DeFi, position it as a top contender for this bull cycle. If LINK follows the bullish thesis put forth by Runefelt, the $30.94 target could just mark the beginning of a much bigger rally as the altcoin continues to gain traction and push the limits of innovation decentralized.
Price Analysis: Holds critical support at $20
Chainlink (LINK) is trading at $20, a critical level that represents a strong weekly demand zone. Analysts and investors are closely watching this price point, as it has the potential to determine the short-term direction of LINK's price action.
Holding above this key support level is critical to maintaining bullish momentum. If LINK manages to sustain itself at $20, it sets the stage for a rebound towards the $25 mark. A break of this resistance could trigger a broader rally, which could propel LINK to multi-year highs as market sentiment shifts in its favor.
However, the stakes are high. A break below the $20 demand zone could lead to a deeper correction, with prices likely to revisit the $16 level. Such a move could shake investor confidence in the short term but could also create new opportunities to rally as LINK establishes new support.
Related Reading
As the market navigates a volatile phase, the coming days will be crucial for LINK. Whether it holds at $20 or tests lower levels, its ability to bounce back and sustain above key resistance levels will determine the strength of the next leg up in its bullish cycle. Investors remain cautiously optimistic.
Featured image from Dall-E, chart from TradingView
