Chainlink has been forming what appears to be a strong base of support within the mid-$13.00 region, as each dip here has resulted in it seeing a strong rebound.
This is leading analysts to note that upside may be imminent, as the multiple strong reactions to this level throughout the past several days is a positive development for the cryptocurrency’s short-term technical strength.
One trader is noting that LINK does still face heavy resistance around $16.00, which may result in it forming a trading range between roughly $14 and $16 in the days and weeks ahead.
Another trader is offering a more optimistic outlook on the cryptocurrency, explaining that although it does face some resistance, he expects the strong support just below its current price to act as a launchpad that sends Chainlink up towards $19.00.
This would allow it to erase nearly all of the losses that have come about as a result of its recent weakness.
In order for this possibility to come to fruition, LINK must continue holding above $13.50.
Chainlink Starts Forming Trading Range as Bulls Defend Mid-$13.00 Region
At the time of writing, Chainlink is trading up nearly 4% at its current price of $14.60. This is around the price at which it has been trading throughout the past few days.
It has dipped as low as $13.50 on a few occasions throughout the past week, but each break below $14.00 has proven to be highly fleeting and followed by an immediate rebound.
This is leading one analyst to note that a trading range may be forming, with the support being the lower boundary and Chainlink’s near-term resistance at $16.00 being the upper boundary.
“$16 was a clear resistance zone as discussed a few days ago. Looking for a scenario like this as we’re constructing a range here,” he said while pointing to the range marked on the below chart.
Image Courtesy of Crypto Michaël. Chart via TradingView.
Here’s How High LINK May Rally if Bulls Defend $13.50
“If we lose the low at $13.50 before taking the first swing high denoted with the ‘X’, it’s likely we are going to see one more leg down as a ‘wash out’ before we get this leg up I was anticipating. Consider $13.50 the invalidation point for this idea (in the short term),” he explained.
Image Courtesy of Credible Crypto. Chart via TradingView.
As seen in the above chart, the upside target this analyst is watching for exists in the $19.00 region, which – if it were to be reached – would mark a nearly full erasure of Chainlink’s recent losses.
Featured image from Unsplash. Charts from TradingView.