Chainlink Price Forecast: LINK technical breakout eyes $16 amid improving on-chain metrics


  • Chainlink recently broke out of a falling wedge pattern but stalled short of $15.
  • Recovery is underway, and it could see LINK make a giant leap to $18 while supported by improving on-chain levels.

Chainlink is nurturing an uptrend after closing the day above the 50 Simple Moving Average. The immediate target on the upside is $16, but the recovery could go as high as $18 if enough volume is created behind LINK.

Chainlink breaks above a key technical pattern

The formation of a descending wedge pattern on the daily chart resulted in the midweek bullish outlook. As Bitcoin hit new all-time highs close to $24,000, LINK rallied past $15. However, the seller congestion at $16 was left untested.

A falling wedge pattern comes into existence when an asset’s price has sustained a downtrend over time—the pattern hail from the downtrend, losing momentum while trendlines drawn along the peaks and the lows converge. Bulls start to step in to regain control over the price, and a breakout happens just before lines converge.

High volatility swept across the cryptocurrency market, resulting in a sharp downswing to the support at $12. Recovery ensued, putting Chainlink back on the growth path to $16. The Relative Strength Index reinforces the improving technical picture as it grids towards the overbought area.

LINK/USD daily chart

LINK/USD daily chart

According to Santiment, a leading provider of on-chain indicators and analysis, Chainlink’s network growth is rising. Following the spike in November that saw the number of new addresses joining Chainlink top 3,450, a decline touched 2,250 on December 15.

At the time of writing, new addresses on the network have surged to almost 3,600, representing a 37.5% increase. High network growth is usually a bullish signal for the project’s future adoption and the token’s value. Hence, the ongoing Chainlink price recovery could gain momentum.

Chainlink network growth chart

Chainlink network growth chart

Note that the expected breakout to $16 and $18 will fail to materialize if Chainlink slumped and closed the day under the 50 SMA. Selling pressure is likely to increase, pointing LINK on a downward trajectory to retest $12 and $11, respectively.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Bitcoin Price Forecast: Analysts anticipate increased volatility as the US presidential election looms

Bitcoin Price Forecast: Analysts anticipate increased volatility as the US presidential election looms

Bitcoin price teased its all-time high of $73,777 last week but declined to trade below $69,000 on Monday. Analysts suggest that market volatility is expected to rise as the US presidential election approaches.

More Bitcoin News
Litecoin poised for double-digit decline after breaking ascending trendline

Litecoin poised for double-digit decline after breaking ascending trendline

Litecoin breaks and closes below an ascending trendline, signaling a change in market structure. On-chain metrics paint a bearish picture, as LTC’s dormant wallets are active, and the NPL indicator shows a negative spike.

More Litecoin News
Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP decline ahead of US elections

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP decline ahead of US elections

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) all faced resistance at crucial levels ahead of the US Elections, leading to a price decline. As of Monday, they neared key support levels, and a firm close below these marks could signal further declines.

More Cryptocurrencies News
21Shares files S-1 for XRP ETF amid ongoing tension between Ripple and SEC

21Shares files S-1 for XRP ETF amid ongoing tension between Ripple and SEC

21Shares filed an S-1 registration with the Securities and Exchange Commission (SEC) on Friday for an XRP exchange-traded fund (ETF). While the chance of approval is slim with the current SEC administration, the landscape could change after the upcoming elections.

More Cryptocurrencies News
Bitcoin: New all-time high at $78,900 looks feasible

Bitcoin: New all-time high at $78,900 looks feasible

Bitcoin price declines over 2% this week, but the bounce from a key technical level on the weekly chart signals chances of hitting a new all-time high in the short term. US spot Bitcoin ETFs posted $596 million in inflows until Thursday despite the increased profit-taking activity.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP