Chainlink sellers halt upside momentum and LINK may return to $27
|- Chainlink price recovers all last Wednesday’s 11% loss.
- While technically bullish, momentum must return to push Chainlink higher.
- Upside potential likely capped near $45.00
Chainlink price looks for more buyers to help push it beyond the $32.50 level. However, a breakout above near-term resistance may get halted against a confluence resistance zone at $45.00.
Chainlink price momentum slows as traders see limited upside potential
Chainlink price action has retraced all of the losses is suffered on last Wednesday’s 11% route. It took a week for Chainlink bulls to recover that loss could be seen as both a bullish and bearish sign. Regardless of how one would interpret that price action, the Ichimoku Kinko Hyo system provides a clear outlook on Chainlink’s current trading condition.
Currently, Chainlink has fulfilled all necessary requirements for an Ideal Bullish Ichimoku Breakout entry: Future Senkou Span A is above Future Senkou Span B, the close is above the Cloud, the close is above the Tenkan-Sen and Kijun-Sen and the Chikou Span is above the candlesticks and in open space.
A hypothetical long trade for Chainlink price would be a buy stop when the daily close is slightly above the most recent swing high-close of $32.56, with a stop loss at $30.00 and a profit target at $45. $45 is the 161.8% Fibonacci expansion of the October 12th low to the October 27th high. Additionally, $45.00 is the top of the prior bear flag channel from June 2021 – which has acted as a primary resistance level for the remainder of 2021.
LINK/USDT Daily Ichiumoku Chart
Any bullish outlook of Chainlink price would be invalidated if an Ideal Bearish Ichimoku Breakout were to occur. For the bearish scenario to take over, Chainlink would need to crash lower and close at $24.50.
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