Key Takeaways:
- Oracle Network Chainlink's native token LINK dropped 11% in a week.
- The charts looked overall optimistic, while flashing some bearish technicals.
- Chainlink boasted growing adoption in Q1, as it solidified the status of the largest oracle network.
YEREVAN (CoinChapter.com) – Chainlink (LINK) fell 11% in a week to reach around $13 this Monday.
Bullish wedge
LINK exhibited bullish signals as it has been forming a classic upside reversal setup, dubbed the ‘falling wedge,’ as shown in the chart below.
LINK risks falling towards the wedge’s lower trendline next, down 22% than today’s price.
Nonetheless, its overall bias remains skewed to the upside, with a strong potential of price breaking above the wedge’s upper trendline, followed by an extended bullish move towards the wedge target, which is generally calculated after measuring the maximum distance between the wedge’s trendlines and add the outcome to the breakout point.
That puts LINK en route to $33.50 in Q2, up over 150% from today’s price.
Also read: Chainlink (LINK) eyes a 30% decline amid the growing TVL – what’s next?
Meanwhile, LINK painted a ‘death cross’ between the 20-day exponential moving average (EMA-20; red wave) and the EMA-50 (the orange wave). The bearish setup supports the forecast of a temporary setback in price before a possible price appreciation.
Chainlink weekly price action
The digital asset’s weekly chart revealed a significant rebound level that could boost LINK in the upcoming weeks. The rebound level stood at $12.3, so LINK could correct it slightly before retesting it as support.
Also read: Chainlink VRF v2 Goes Live on Mainnet. What’s new?
Michael Van de Poppe, a crypto analyst, and the chief executive of consulting firm Eight Global, agreed with the bullish outlook, citing the heightened demand for oracle networks and Chainlink’s leading status. The CEO also tweeted the three-day chart, asking his followers if they would short or long LINK based on the price action.
However, the charts flashed bearish hints as well. For example, the daily and weekly trading volumes have been declining for the entire Q1. Typically, the decline signifies either growing disinterest among traders or holding incentives. However, given the dropping price action, the former is more likely.
Also read: 21Shares launches three new crypto-ETPs: Aave, Chainlink, and Uniswap.
Meanwhile, Chainlink posted its Q1 results on Apr. 16, noting the growing Network that included over 900 decentralized oracles. Additionally, according to the announcement, the Protocol got over 4.4 million randomness requests, completed over 20,000 automated transactions, and added 1,250 projects to its ecosystem.
