Without a doubt, one of the cryptocurrencies that has performed the best in 2020 is LINK, increasing by 478% so far this year. But since not everything is eternal, after a volatile rise capable of marking an all-time high, Chainlink has been involved in a strong downtrend that led the price to currently trade at $ 8.17.
We were recently talking about how prone the LINK token was to lose support at $ 10; And despite the fact that it still maintained some positivism, a product of the upward force that the medium-term trend impresses, still the bears had total control of the short-term trend.
It should always be borne in mind that even though the major trends have more hierarchy, the smaller ones are also generating changes until they manage to challenge them.
Today we see the price of LINK totally convinced to continue falling, after having lost an area of demand close to $ 9.52, leaving the ground clear to reach at least $ 7.
Let’s see the current situation below, and what we can take out of it to forecast the future direction of the price.
Chainlink Technical Analysis: Medium Term Trend
From the weekly chart we still continue to see the bulls in control of the medium-term trend.
Although we recently saw the break of an immediate support, located at $ 15.14, even the sellers have not managed to establish a downtrend in the medium term.
The 8-week EMA and 18-week SMA moving averages are crossed to the upside. It is still possible that they will function as dynamic supports before starting a new bullish momentum, in favor of the medium-term trend.
Currently the price is very close to visiting the immediate demand zone, in which the momentum began that took it to an all-time high.
It is quite probable that strong buying intentions will appear there, but for now it is only necessary to wait for the reaction in that area.
Chainlink’s short-term trend
In the short term, the trend is solidly bearish, a product of continuously lower and lower maximums and lows, followed by the moving averages of the 8 EMA and the 18-day SMA.
We are currently developing momentum from this trend, but sooner rather than later we will be seeing some corrective process. For the bulls, hope that this goes beyond a simple setback and becomes a change in trend.
At the moment the short-term probabilities are on the side of the sellers, and you only have to wait for the reaction in the surrounding area at $ 7.
The 200-day SMA is still bullish, supporting the strong gains of recent months and the medium-term bullish trend. This average will be reached when the price reaches $ 7, and is likely to function as an important dynamic support.
The behavior in the 4-hour time frame is solidly bearish, following the short-term trend.
The moving averages EMA of 8 and SMA of 18 periods of 4 hours are crossed to the downside and working as dynamic resistances.
This Chainlink price chart is a good place to expect some sort of bullish reaction if you want to position yourself in favor of the medium-term trend. For now, let’s follow the current flow of continuous support breaks..
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