Chainlink bulls post strong gains, can the rally reach July’s highs?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Chainlink has a strongly bullish outlook up to the daily timeframe
- Bulls who bought LINK from $7 or lower could wait for further gains before booking profits
Chainlink [LINK] posted impressive gains over the past two weeks. The defense of the $5.7 support level resulted in a rally measuring close to 30%. The evidence at hand showed that further green can be expected.
How much are 1, 10, or 100 LINK worth today?
A recent report highlighted that Chainlink saw a surge in exchange inflows, a metric that usually indicates a sell-off could commence. LINK bucked this trend in recent days but how much further would the rally extend?
The strong bullish structure meant long entries could be late from here onward
The move above the $6.4 resistance level flipped the market structure bullishly on the 12-hour chart above. Moreover, the rally was quick and did not give traders of higher timeframes many clean long entry opportunities after the breakout. One such that was on offer last week was the $6.6 level.
In the coming days, a dip to $7 and $7.2 could provide a low-risk buying opportunity with invalidation nearby. Meanwhile, bulls who entered long positions much earlier can wait for a move to the $8.5 resistance zone to book profits.
The On-Balance Volume (OBV) saw a breakout past a near month-long local resistance. Furthermore, the Relative Strength Index (RSI) also signaled firm bullish momentum.
The $8.46 level marked the high of the H12 bearish order block from 20 July. Hence, the $8.4-$8.5 zone and the $7.7 level can be used to take profits, at least partially. Moreover, these were the levels where a bearish reversal could be initiated.
The market sentiment remains largely bullish in the lower timeframes
Data from Coinalyze reinforced the expectations that the Chainlink rally could continue to further heights. The Open Interest (OI) trended upward since 23 September. The spot Cumulative Volume Delta (CVD) also saw a massive spike in the past 24 hours.
Realistic or not, here’s LINK’s market cap in BTC’s terms
Over the next week or two, Chainlink could advance to $8 or $8.5 and face rejection. This rejection could see LINK form a range, or a sharper rejection could see LINK break its H12 market structure. These are some scenarios that traders can watch out for.