Bearish Pattern Emerged In Chainlink Chart Tease A Revisit To $5.8 Mark

The daily technical chart shows the Chainlink price has followed a range-bound rally for the past four weeks. Several times, the coin price has retested both the upper($9.54) and lower($6.2-$5.8) barriers, validating them as areas of high interest. The ongoing recovery within the pattern aims for the upper barrier mentioned above.

Key points from Chainlink analysis

• A broadening channel pattern maintains the current recovery in chainlink price,
• The crucial EMAs(20, 50, and 100) accentuate a sideways ally
• The intraday trading volume in the LINK coin is $512.8 Billion, indicating a 7.3% loss.

Source- Tradingview

A new bull cycle within this range was initiated on August 29th, when the Chainlink coin price rebounded from the $6.2 support with a bullish engulfing candle. The bull-run accounted for a 32.8% rally, which marked a high of $8.3.

However, the chainlink price shows a sharp reversal from this level as the crypto market witnessed a sudden sell-off. The downfall was caused when the recent CPI rate data pointed to 8.1% Y-o-Y inflation. 

Furthermore, it seems the ongoing recovery in Chainlink coin price is responding to a broadening channel pattern. Thus, the pattern’s support trendline stalled the falling price at $7 and reverted it higher by 4.8%.

The altcoin currently trades at the $7.34 mark, and under the influence of this pattern, it could rise even to the top resistance of $9.5. However, the very nature of this pattern is bearish, and therefore, a breakdown from its support trendline will trigger a significant correction.

Thus, the trendline breakdown will accelerate the bearish momentum and plummet the prices to $6.2-$5.8 bottom support.

However, concerning the bigger picture, the chainlink coin will remain sideways until prices don’t breach the $9.5 or $5.8 barrier.

Technical Indicator

RSI indicator: the daily-RSI slope attempt to re-enter the bullish territory indicates the market participant still keeps hopes from Chainlink price

Bollinger band indicator: the coin price trading above the midline reflects the current market value is higher than the mean value from the ongoing price range. 

• Resistance levels- $7.42, and $8.16
• Support levels- $6.6 and $6.2-$5.8