Chainlink Hits All-Time High; Passes Litecoin In Market Cap

Chainlink has been one of the best performing cryptocurrencies since the start of the new year. Recently hitting a new all-time high of $26.60. With the surge, LINK overtook Litecoin as the seventh-largest market cap.

The daily chart for Chainlink shows massive volatility in recent months, but also some beautiful price action. Every previous level of resistance flipped for support, after which the price continued climbing almost in textbook fashion.

Chainlink dropped to as low as $16.70 on Jan. 21 before regaining most of the losses. This is especially important because LINK proved it could bounce back even while Bitcoin dropped below its support levels of $32,000.

Most people have the impulse to enter a position when the price is soaring. As those support/resistance flips actually give the best entries. The first support/resistance flip occurred at the $10 level, after which the same happened with the $13 and $17.30 areas.

As a result, the crucial level to watch for potentially more downside is the $17.30 area, as well as the $19.50 zone. The latter area is the previous all-time high in 2020. Possibly the point of the next support/resistance flip, which would be bullish for more upside.

Link Price Discovery

As Chainlink is in price discovery, it becomes difficult to define the potential top structures’ next points of interest. However, the Fibonacci extension tool has proven to be quite useful.

Using this indicator, the first zone is between $29-31, which aligns with both of the Fibonacci extensions. The second zone is at the 2.618 Fibonacci extension of $39 and the last one falls in the $42 area.

The next impulse wave will likely see a big surge in the Bitcoin pair of LINK. The recent run was spearheaded by Bitcoin, while the altcoin-BTC pairs were relatively flat.

Once Bitcoin finishes its correction and starts to move upward in a slow manner, the likelihood of altcoins outperforming Bitcoin increases.

Chainlink has been able to maintain its bullish rally due to an increasing amount of number of active addresses. Over the past three months, active addresses are up by 143%. Over the past 24-hours, 5,301 new addresses were added.

Earlier this week, the on-exchange supply ratio of LINK also reached a yearly-low, indicating that investors are maintaining their hodling sentiment with the token.

Grayscale Rumored To Add Chainlink

Amid a strong start to 2021, Chainlink could see even more gains with Grayscale rumored to be adding support for the altcoin in the near future.

An addition to the Grayscale Trust would be a massive win for Chainlink as it opens a gateway for institutional investors for the project. However, Grayscale has not been the best parameter of market improvement over the past year, with the exception of Bitcoin.

Ethereum, the second-largest asset by market cap, is currently facing discrepancy on Grayscale. Because of this, it might take a while before Chainlink can incur significant institutional interest.

An altcoin rally ultimately could be sparked by the likes of Chainlink, Polkadot, and Sushi, which may see LINK register another all-time high before the end of Q1.

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