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Chainlink (LINK) Breaks Below Key Support, Signaling Potential Downtrend

2 mins
Updated by Ryan James
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In Brief

  • LINK has turned bearish after a 13% correction on Friday, breaking key support levels at $17.40 and $16.70.
  • The price has entered the 200 EMA on the 4-hour chart, anchored to the volume profile peak.
  • Key support levels to watch are $15.60 and $14.30, which correspond to the significant flat baselines on the 4-hour timeframe.
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After a dramatic 13% correction on Friday, Chainlink has shattered key support levels, leaving traders and investors on edge.

The question on everyone’s mind is: what comes next for Chainlink? With a bearish cloud hanging over the market and Bitcoin’s price struggling below $70,000, understanding the technical landscape has never been more crucial.

The price of LINK has turned bearish after a 13% correction on Friday.

LINK has broken key support levels, notably $17.40, which corresponds to the 100 EMA (Blue line) on the 4-hour chart. The volume profile peaks at $16.70.

The price has also entered the green zone, corresponding to the 200 EMA on the 4-hour chart. This area is anchored to the volume profile peak (Yellow line) of $16.70.

The $16.70 and $18.00 price levels remain strong resistance points. Given the current market conditions with Bitcoin trading below $70,000. LINK is likely to struggle to break through these levels.

Read More: How To Buy Chainlink (LINK) and Everything You Need To Know

Chainlink 1D Price Analysis. Source: TradingView
Chainlink 1D Price Analysis. Source: TradingView

The most important support levels to watch at this price level are $15.60 and $14.30.

These levels correspond to the significant flat baselines of the Ichimoku Cloud on the 4-hour timeframe. Providing key areas of potential support amid the current bearish trend.

On the daily price action, Chainlink has entered the Ichimoku Cloud, indicating a very bearish signal. The RSI has also dropped significantly from 70 to 43 within this time frame.

LINK is currently finding strong support at the 200-day exponential moving average (green area).

Such a move would likely see the price heading straight to the lower boundary of the red Ichimoku Cloud on the daily timeframe, around $14.30. This $14.30 level is a critical support point, and a continuation down to this level would indicate a bearish trend.

Chainlink 4H Price Analysis. Source: TradingView
Chainlink 4H Price Analysis. Source: TradingView

If the price breaks this level (EMA 200) and breaches the $15.60 support level, LINK could be very bearish. The mid-term resistance level is located at the daily 50 EMA and 100 EMA, within the $16.30 – $16.50 price range.

If the price rises above these levels (50 & 100 EMAs), it could present an optimistic technical scenario for LINK, potentially pushing LINK above the Ichimoku Cloud, which would be a positive bullish sign for the mid-term outlook.

Read More: Chainlink (LINK) Price Prediction 2024/2025/2030

Given the current market conditions, with Bitcoin trading below $70,000, LINK will likely struggle to break through the $16.70 resistance level.

Monitoring these key support levels ($15.6 and $14.3) can help traders make informed decisions and manage risk effectively.

Additionally, the decline in LINK’s price, now trading 30% below its local high from March 2024, suggests the potential for further declines. Therefore, keeping a close eye on the market and adjusting strategies accordingly is crucial.

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Adam Mourad
Adam, 23, is a full-time on-chain analyst and part-time trader in the Web3 space. He is the founder and CEO of 0nchained, an on-chain data reporting service. Adam started his journey with CryptoQuant, where he still works as an analyst. Over the past year, he has developed over 30 indicators and written more than 120 analyses. His passions include data and analytics, cryptocurrency, and supercars, particularly red Ferraris and yellow Porsche GT3s. His professional achievements are...
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