Chainlink (LINK) has recently shown resilience after a 35% retracement from its annual highs, crossing over 30% to confirm liquidity around the $23 mark. Despite this recovery, bearish sentiment continues to weigh heavily on altcoins, and Chainlink is no exception. The cryptocurrency has struggled to regain its local highs, raising questions about whether the recent rally has enough momentum to sustain further gains.
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Lead analyst Ali Martinez provided a detailed technical analysis of X, highlighting a critical pattern that could dictate LINK's next move. According to Martinez, Chainlink is forming a head and shoulders pattern – a structure that is often associated with a bearish reversal. If this pattern is confirmed, LINK could see a major decline, possibly dropping as low as $14 in the coming weeks.
This technical situation puts Chainlink at a critical level, where holding above current levels is essential to avoid deeper corrections. Investors and traders will be watching price action closely, with $23 being a key resistance level. Whether your LINK overcome bearish sentiment or succumbing to another downgrade is likely to depend on broader market conditions and its ability to invalidate the bearish pattern. For now, Chainlink's outlook remains uncertain, keeping market participants ahead.
Chainlink Price Action Showing Weakness
Chainlink (LINK) has experienced a challenging price environment since falling from annual highs, reflecting broader bearish sentiment in the altcoin market. Despite showing some recovery, LINK's price action has remained limited, with significant resistance around the $26 mark. Retrieving this level is essential for invalidating bearish views and managing bullish momentum.
Major analyst Ali Martinez recently share technical analysis of Xhighlighting how a head and shoulders pattern could form. This bearish position, if confirmed, could send LINK as low as $14. Such a move would be a real downgrade from current levels and underlines the challenges LINK faces in regaining its previous highs.
However, all hope is not lost. Martinez notes that holding above the $22 mark could give Chainlink a solid base to stabilize and reverse the bearish trend. A decisive push above $27 will strengthen bullish momentum, indicating a possible return to a more optimistic outlook.
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For now, the market is still full of uncertainty. LINK's direction is likely to be influenced by broader market conditions, including Bitcoin's performance. If LINK can successfully navigate these key levels, it could overcome the bearish narrative and position itself for a more sustained rally. Until then, caution is still needed for traders and investors.
LINK tests liquidity
Chainlink (LINK) is currently trading at $23 after confirming a successful bid at the $22 level. Despite maintaining this important support, price action does not have a definitive direction, leaving traders and investors in a state of uncertainty. Bears seem to be in control for now, with the recent pullback from annual highs weighing heavily on sentiment. However, the $22 mark has been a strong support, suggesting that demand could arise at any time to recover the rise.
For LINK to be free from this uncertain level, it must overcome the critical resistance at $26. A push above this level would invalidate the current bearish outlook and would likely trigger a major rally, with the potential to reverse and surpass previous highs. Such a move would restore confidence among traders and attract new buyers to encourage more enthusiasm.
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On the downside, holding above $22 would expose LINK to more selling pressure, which could confirm lower support levels and extend the bearish trend. For now, the market is still in a compression phase, with both bulls and bears waiting for the next decisive move. The coming days will be crucial for LINK as it tries to find direction amid wider market uncertainty.
Featured image from Dall-E, chart from TradingView
