Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice
The crypto-market has been on a roll lately, with Bitcoin, the world’s largest cryptocurrency, leading the charge with its price performance on the charts. Thanks to the correlation it shares with the rest of the market’s alts, when BTC rallied to $47,500-$48,000, so did the rest of the altcoin market, including the likes of Chainlink.
At the time of writing, having finally breached the much-anticipated psychological resistance level of $30, the crypto was trading at $30.82.
Chainlink daily chart
Source: LINKUSD on TradingView
Chainlink’s daily chart highlighted bullish momentum coursing through its market. While the digital asset’s value did hit a price peak, the trend did not change, indicating that users are still holding their alts close and are unlikely to sell anytime soon.
However, the market may soon see a drop in value, one before it can continue trading at the same price level.
Reasoning
The price of Chainlink has been pushing higher for a while, and it was doing so even during Bitcoin’s consolidation phase. However, now that the price is surging on a daily basis, LINK has reached its peak. At this point, the volatility in the market will hike, as suggested by the divergence of the Bollinger Bands. Meanwhile, the signal line highlighted the upwards trending price on the charts.
The 50 moving average may act as support in case of a breakdown. However, this would be only possible if the selling momentum increases. Further, the Relative Strength Index suggested that LINK had moved into the overbought zone, at the time of writing.
At a high price, the volume has to support the value of the digital asset, therefore, even if there is selling pressure in the market, the bullish trend may ward it off and make sure LINK is positioned higher on the charts.
Conclusion
Although bullish, there might be small corrections visible in the Chainlink market. Given the bullishness, the change of trend in the long-term may not last. It will be taken over by the buyers in the LINK market. Given strong network activities, the LINK community has been supportive of the developments which have translated into the high value of the digital asset. This momentum may push LINK’s price further along the price scale.
