Key Takeaways:
- LINK price tested the $5.50 support zone and started a recovery wave.
- A major bearish trend line is in place with resistance at $6.00 on the 4-hours chart.
- The price could rally if there is a clear move above the $6.0 resistance.
Chainlink’s LINK is consolidating losses above the $5.50 level. The price might start a decent recovery wave if it clears the $6.00 resistance.
Chainlink (LINK) Price Faces Resistance
After facing a strong rejection above $7.20, LINK’s price started to decline against the US Dollar. The price declined below the $7.00 and $6.50 levels to move into a bearish zone.
Recently, bitcoin and ethereum gained bearish momentum, but the downsides in LINK were less. It traded below the $6.00 support level and the 50 simple moving average (4 hours, blue). It traded as low as $5.53 and recently started an upside correction.
The price was able to clear the $5.75 resistance level. There was a move above the 23.6% Fib retracement level of the downward move from the $6.86 swing high to the $5.33 low.
However, the LINK price is still well below $6.00 and the 50 simple moving average (4 hours, blue). On the upside, immediate resistance is near the $6.00 level. The first major resistance is near the $6.10 level and a connecting bearish trend line on the 4-hours chart.
The trend line is near the 50 simple moving average (4 hours, blue) and the 50% Fib retracement level of the downward move from the $6.86 swing high to the $5.33 low.
The next major resistance is near the $6.25 level. A clear move above the $6.25 resistance level could set the pace for a steady increase. The price could revisit the $6.65 resistance level in the stated case. The next major resistance is nearly $7.40. Any more gains might open the doors for a move toward the $8.00 resistance.
Bears Remain In Control?
Conversely, the LINK price might fail to clear the $6.00 resistance zone or $6.10. In the mentioned case, the price could resume its downtrend. Initial support is near the $5.80 level. The next major support is nearly $5.50. A close below $5.50 may send the price toward the $5.00 support.
Overall, LINK’s price is consolidating losses and attempting an upside break above $6.00. If the bulls gain strength, it could rise towards the $6.65 resistance or $7.40. If not, there could be a drop toward the $5.00 support zone.
