The Chainlink (LINK) price is trading at a crucial short-term resistance of $7.50. Reclaiming it would pave the way for a quick pump toward $9.40.
The Chainlink price has traded above the $5.95 support area since the beginning of May. While it fell below it numerous times, it did not reach a close, instead created a long lower wick and bounced.
On Nov. 20, the LINK price reached a daily close of $5.76, which was the lowest of the year. While this seemingly caused a breakdown from the $5.95 support area, the price movement afterward was bullish, causing a reclaim. So, the alleged breakdown was only a deviation (green circle).
Strong movements in the other direction often follow such deviations. The price action supports this possibility, since Chainlink reached a high of $7.51 before dropping slightly.
The daily RSI also moved above 50. However, it has been doing so since May, so it has to validate the line as support in order for the LINK price forecast to be bullish.
A daily close above the $9.40 resistance area would confirm the bullish Chainlink price prediction.
Will Chainlink Price Get Rejected?
The technical analysis from the six-hour time frame shows that there is short-term resistance at $7.50. This resistance is created by both the 0.5 Fib retracement resistance level and a horizontal resistance area.
While LINK reached a maximum price of $7.51 over the past 24 hours, it failed to reach a close above the resistance area.
Moreover, the RSI has generated bearish divergence (green line). This does not bode well for the future price and could be the catalyst for a decrease.
So, the Chainlink price may fall to the $6.55 support area before making another attempt at breaking out.
If a close above $7.50 is reached, an upward movement towards $9.40 would be expected.
For BeInCrypto’s latest crypto market analysis, click here.
Disclaimer: BeInCrypto strives to provide accurate and up-to-date news and information, but it will not be responsible for any missing facts or inaccurate information. You comply and understand that you should use any of this information at your own risk. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.
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.