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Chain link is facing increasing bearish pressure as the price continues to decline, signaling a possible move towards further downside. After a period of consolidation, the bears have regained control, pushing Chainlink closer to the USD 9.28 support level.
However, Bulls may not be ready to give up just yet. With market sentiment fluctuating, there is the possibility of a bullish one comeback looms on the horizon. By researching key Based on technical indicators and market sentiment, we try to determine whether LINK is ready for a deeper decline or whether bullish forces could reverse the current trend and push the price higher.
At the time of writing, Chainlink was trading around $10.59, down 0.10% over the past day. The cryptocurrencies market Capitalization amounted to approximately $6.4 billion, while trading volume exceeded $206 million, showing increases of 0.10% and 15.36% respectively.
Current Market Sentiment: Pressure on Chainlink is Increasing
On the 4-hour chart, after a successful decline below $11, LINK continued to experience negative momentum heading towards the 100-day Simple Moving Average (SMA). As the cryptocurrency approaches the 100-day SMA, it may find temporary support or risk falling further if the SMA occurs bearish momentum continues to increase.
The Relative Strength Index (RSI) on the 4-hour chart has also fallen below the 50% threshold and now stands at 42%. As the RSI attempts to move deeper into oversold territory, it appears that the bears are gaining control, and a longer decline is in store if buying interest does not pick up again soon.
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On the daily chart, Chainlink is currently making a bearish move towards $7.14 which is trading below the 100-day Simple Moving Average. This move underlines strong selling pressure and negative market sentiment, indicating an increased risk of further losses.
Finally, the 1-day RSI reflects increasing pessimistic pressure on LINK, as the indicator has fallen to 47% after briefly crossing above the 50% threshold. This decline highlights the increasing sales activity and signals a stronger one potential for extra downward movement.
Will LINK see a recovery or further decline?
As the cryptocurrency approaches $9.28 support level, which could trigger a potential technical recovery indicators such as the RSI still indicate strong selling pressure. If LINK fails to hold this level, a break below could result in continued declines, potentially testing the $7.14 support level and even lower thresholds.
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However, should Chainlink manage to hold above this crucial support level, it could pave the way for a potential upside move towards the $11.10 resistance. A successful break from this resistance could trigger a significant rally, paving the way for the price to target the next major resistance at $12.44. If bullish momentum continues to build, Chainlink could reach even higher levels, extending the rally past current resistance points.
Featured image from Medium, chart from Tradingview.com