Chainlink Price Prediction: LINK struggles to stage a convincing recovery, bears eye $20

Chainlink is down more than 20% since the start of the week.
Several strong resistances are located just above the price.
Next significant support for LINK is located around $23.

Chainlink suffered heavy losses at the start of the week and failed to shake off the bearish pressure. Following a recovery phase on Wednesday, the bearish momentum gathered strength, once again, and forced LINK to extend its weekly slide. As of writing, Chainlink was trading at $25.30, losing nearly 26% on a weekly basis.

Near-term outlook to remain bearish if LINK fails to reclaim $30

Despite the huge drop witnessed earlier in the week, the Relative Strength Index (RSI) on the daily chart holds near 40, suggesting that there is more room on the downside before LINK becomes technically oversold. The initial support is located at $2, the Fibonacci 50% retracement level of the rally seen during the first half of February. A daily close below that level is likely to open the door for additional losses toward $20 (psychological level, Fibonacci 61.8% retracement) and $19 (100-day SMA).

Resistances are located at $26 (Fibonacci 38.2% retracement ahead of $29 (Fibonacci 23.6% retracement) and $30 (psychological level, 20-day SMA).

LINK/USD one-day chart

IntoTheBlock's In/Out of the Money Around Price (IOMAP) model confirms that the next significant support area is located a little below $23 with more than 11K addresses purchasing nearly 8.7 million LINK around that price.

On the upside, several strong resistances seem to have formed between $26 and $28, suggesting that buyers are unlikely to show interest in Chainlink unless the price clears that area.

LINK IOMAP chart

Although Chainlik was able to pull away following Monday's unprecedented slump, the near-term technical outlook and on-chain metrics show that sellers remain in control of the price action. The next leg down could drag the price lower toward $20 and only a daily close above $30 could attract buyers.

Share: Cryptos feed

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.