fxstreet.com
- Chainlink price is trading within the lower segment of the ascending channel, thinly holding above $16.86.
- LINK could drop 25% to $13.08 if markets show weakness.
- A break and close above $20.70 would invalidate the bearish thesis.
Chainlink (LINK) price has consolidated within a range for the past two months amid a prolonged altcoin lull as Bitcoin (BTC) price bullish momentum stalled. With reducing trading volumes, volatility increased, causing LINK price to fluctuate.
Chainlink price calculates a 25% breakdown
Chainlink price is likely to fall 25% to provide another buying opportunity at $16.86 as the Bitcoin price remains below $69,000 meaning the upside potential remains in the balance. With this level of uncertainty, altcoins could still drop, with Chainlink price eyeing a breakdown of the $16.86 support.
The Relative Strength Index (RSI) is dropping, moving below the 50 mean line and accentuated by the Awesome Oscillator (AO) indicator, which is in negative territory. With these pointing to a growing bearish sentiment, Chainlink price could make a 25% drop to $13.08.
In a dire case where the aforementioned level fails to hold as support, the LINK price could descend for a sweep of the liquidity resting below $13.08 before a potential move north.
LINK/USDT 1-day chart
On the other hand, a recovery that sets LINK price above $18.32, effectively meaning that $16.86 holds as support, could encourage more buy orders. A flip of the midline of the channel into support at $20.70 could precipitate a full-swing recovery rally, with the Chainlink price likely to make a run-up to the $28.71 target objective.