Chainlink’s native token LINK has been tightly coiling over the past few months, trapped between key support at $13 and stiff resistance at $17. However, multiple signs are emerging that LINK may soon break out from this range as growing momentum aligns for a markup phase.
- Chainlink’s LINK price has been consolidating between $13 and $17 since November, showing signs of an “accumulation phase” typically followed by a “markup phase” with rising prices
- Technical indicators like MACD, AO, RSI are turning bullish, signaling growing momentum and upside potential
- If buying pressure continues building, LINK could break out above $17 and even test $20, a 20% surge from current levels
- LINK recently rallied 17%, providing a catalyst toward the $17 barrier and potentially higher into uncharted territory
- Support and resistance levels to watch: $13.33 support, $17 and $20 potential upside targets
LINK has been consolidating since November, transitioning from distribution and markdown phases into an apparent accumulation structure. According to renowned analyst Richard Wyckoff, the accumulation phase is characterized by stabilization, indecision, and ranging prices as sellers exit positions. This sets the stage for a subsequent markup phase where buying pressure takes over, igniting a swift rally higher.
And that’s exactly what LINK’s technical indicators seem to be forewarning. The Awesome Oscillator is flashing bullish signals as its histogram bars turn green and ascend toward positive territory. Meanwhile, the MACD lines appear on the verge of a bullish crossover, angling upward from their orange signal line. The Relative Strength Index also leans north, looking to cross above its parallel yellow signal line.
Bolstering the bull case, Chainlink’s 100-day and 200-day simple moving averages reside comfortably above the price action at $13.16 and $9.99 respectively. With these key averages pointing decidedly upward, the path of least resistance seems directed to the topside for LINK in the near term.
Buying pressure is already building at the current consolidation floor near $15.50. A break above the sideways structure could propel LINK to challenge multi-month resistance at the $17 level. Notably, LINK rallied 17% this past week, igniting optimism it could power through the barrier. In an ultra-bullish scenario, analysts contend LINK has room to run as high as the psychological $20 mark – representing 20% returns from its launching pad.
To the downside, KEY support rests at $13.33. A daily close below this floor would negate the bullish thesis and risk declines toward the $12 zone. More remote support sits at the 200-day SMA near $10 if bearish momentum persists. But for now, LINK appears positioned for upside continuation as it charges within its accumulation base.
The days ahead will prove pivotal as traders eye whether Chainlink can translate its coiling consolidation into an impulsive markup phase. With LINK rallying within a stone’s throw from multi-month resistance, the tension is palpable. A breakout could set off fireworks, while a breakdown would unravel the foundational buying impetus. Either way, volatility appears in store with a definitive trend likely to emerge soon.