Few assets can claim the trajectory of Chainlink (LINK). After having gained 800% in USD value between 2019 and now, the oracle altcoin dramatically gave back the majority of that valuation last week and over the weekend, as both cryptos and traditional assets imploded in the aftermath of the economic shocks caused by COVID-19.
Now, LINK is resting on a last-stand support line even as cryptos threaten to break yet lower. But there seems to be some interesting awareness in the market.
We start on the weekly LINK/USDT chart, and first notice the “scam wick” flash-crash down to $0.0001 on Binance last week. This was purely a Binance issue, as other exchanges didn’t repeat the performance; but LINK also didn’t do much better on those exchanges, either.
We can see that the $1.50 area is extremely important. Given the context, holding this value would be a major accomplishment and it’s hard to presume that it will hold. The next major support is at about $1, and then into 2017 price levels. At this point, anything can happen.
If we look at a 3-day LINK/Bitcoin chart, however, we see a refreshing sight: seemingly organized market action. It seems that some support is showing up right at the breakout site from a huge consolidation earlier this year.
Things are still very early going, though. There is no reason to ultimately expect that things cannot continue collapsing. But this is an area to watch on the LINK chart in the coming weeks.
Zooming into a 4-hour view of the same chart, we see the precision with which the market is reacting at this particular price level. We also see what is the possibility of a bull divergence on the RSI, if in fact this is a local LINK bottom (nobody should be talking about capital-B “Bottoms” about anything at this point).
Chainlink proved to be one of the most frenetic and bullish coins of early 2020, as it did in 2019 and even 2018. Now, in the aftermath of the COVID collapse, its powerful support has been shown to have its limits. But there still seems to be an adroit market for this mighty altcoin. Be careful out there, now more than ever.
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