Chainlink has been trading in range since June 2021. While the lower time frames offered both buying and selling opportunities, the longer time frames did not offer as many buying opportunities. Instead, the $28 and $19 areas have presented themselves as places to sell the coin. In recent weeks, Bitcoin has surged from the $34,000 level to the $44,500 level, with LINK bouncing from its lowest range to $19.
Since June 2021, LINK has been trading within the $35.5 and $13.45 levels, forming a range. Within the range, the 25%, 50% and 75% (yellow) levels were marked and have offered some resistance or support to the price.
In early December, the price found some demand in the $18.9 area. This fueled an impulsive bullish move to $28, and in mid-January, the bears forced a move back to the $13.5 range lows.
At the time of writing, the price appeared to be moving back to these range lows. This was because the area where demand previously forced an upward move from $19 has now been retested as a resistance and the price rejected.
If LINK hits the lows of the range, it would present a good long-term buying opportunity in terms of risk-to-reward.
On the daily chart, the RSI made a higher low while the price made a lower low. This bullish divergence could see a small bounce, possibly all the way to $16.3 or $17.3.
The CDV has hit higher lows since July last year, a sign that buying volume is higher than selling volume during this period. Still, price action exhibited a bearish market structure – the CDV alone does not warrant a buy signal.
The CMF moved back into neutral territory, showing that at the time of writing, the flow of capital was not favoring either side.
While the CDV formed higher lows, the market structure remained bearish. The lows of the range provided a good area to buy Chainlink, in terms of R:R. The lows of the long 9 month streak could see long-term investors with horizons as buyers.
Disclaimer: The findings of this analysis are the authors’ sole opinions and should not be considered investment advice
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