The Chainlink (LINK) price has made five unsuccessful attempts at breaking out from a long-term descending resistance trendline.
Chainlink accumulation appears to be occurring as long-term holders and institutional wallets have withdrawn many coins from the Binance exchange.
Chainlink Makes Fifth Breakout Attempt
The weekly timeframe technical analysis shows that the LINK price has followed a descending resistance trendline since June 2022.
During this time, it has made five attempts at breaking out (red icons), all unsuccessful. The most recent was made two weeks ago.
Before reaching the descending resistance trendline, the LINK price deviated below the $5.60 horizontal support area and then reclaimed it. It created a higher low in August (green icon), validating it as support before resuming its ascent.
The weekly RSI is bullish. When evaluating market conditions, traders use the RSI as a momentum indicator to determine if a market is overbought or oversold and to decide whether to accumulate or sell an asset.
If the RSI reading is above 50 and the trend is upward, bulls still have an advantage, but if the reading is below 50, the opposite is true.
The indicator is increasing and is above 50 (green circle), both considered signs of a bullish trend.
There is interesting news in the form of an institution with 81 wallets, which has accumulated $4.2 million in LINK today. The wallets were created on September 15 and withdrawn from Binance three days later.
Since then, they have accumulated $56 million in LINK.
The Chainlink accumulation is also seen in long-term holders. Six long-term holders have accumulated $2.4 million in Chainlink from Binance today. These accounts all hold more than $800,000 in LINK and have not traded any other altcoins besides LINK.
Finally, Chainlink co-founder Sergey Nazarov believes that banks are disadvantaged in regard to blockchain adoption since they are already heavily invested in SWIFT.
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LINK Price Prediction: When Will Correction End?
The daily chart shows that the Chainlink price created a long upper wick on October 8 and followed that with a bearish candlestick the next day. This negated all of the previous gains from October, leading to a low of $7.13.
Elliot Wave theory and Fib levels in the daily time frame suggest that the price will reach a bottom soon.
Technical analysts employ the Elliott Wave theory as a means to identify recurring long-term price patterns and investor psychology, which helps them determine the direction of a trend.
The most likely count suggests that the ongoing correction is part of an A-B-C structure. If so, the LINK price is currently in the C wave of this correction.
Giving waves A:C a 1:1 ratio will lead to a low of $6.95.
The $6.95 area is important since it is also the 0.5 Fib retracement support level of the entire upward movement.
This confluence makes it likely that the price will reach a bottom there before bouncing towards the long-term resistance trendline at $8.10, 11% above the current price.
It is also in line with the Chainlink accumulation from long-term holders.
Despite this bullish LINK price prediction, a close below the $6.95 horizontal support area will mean that the trend is still bearish.
In that case, a 13% drop to the next support at $6.35 will be expected.
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