Analysis
Chainlink: how high can the bullish rally go?
Growing demand for Chainlink can extend bullish gains as buyers flip $6 resistance to support.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Increased buying pressure took LINK above $6 resistance.
- Open Interest rose along with prices, hinting at strong bullish resolve.
Chainlink’s [LINK] bullish position on the 12-hour timeframe extended its bounce from the $5 support level. The increased buying pressure over the weekend saw LINK flip the technical and psychological $6 level from resistance to support.
Read Chainlink’s [LINK] Price Prediction 2023-24
While bulls have been rallying, the price action suggested bears were still actively on the hunt for a price reversal. However, flipping the $6 level has given buyers a good chance of extending the rally, especially as Bitcoin [BTC] remained above $30k.
Rising demand could encourage more gains for bulls
Source: LINK/USDT on Trading View
The emergence of LINK from the year-low of $5 upon a retest took out major bearish roadblocks. A wave of successive bullish candles between 20 June to 22 June took LINK to the bearish trendline.
Although a brief pullback ensued, the strong buying power spurred LINK above the confluence of the bearish trendline and the $6 resistance level.
Looking ahead, a 3.24% increase in Chainlink’s market cap, per CoinMarketCap, could spur more bullish gains. An increasing market cap signifies good demand for a coin, which could cause higher prices.
The Relative Strength Indicator (RSI) highlighted the growing demand for LINK as it stood at the edge of the overbought zone with a reading of 70. The Moving Average Convergence Divergence (MACD) posted a bullish crossover on 15 June and has been on an uptrend above the zero mark.
LINK buyers can look to ride on further price gains for Bitcoin to establish a clear bullish trend. However, they will first need to successfully defend the $6 support zone.
How much are 1,10,100 LINKs worth today?
Market speculators buy into bullish intent
Source: Coinalyze
The Open Interest data from Coinalyze showed a consistent rise in open contracts for LINK since 15 June. It coincided with the MACD’s bullish crossover, hinting at buyers’ confidence in turning the bullish rally into a trend.
The OI-weighted Funding Rate has also been positive since 21 June, signaling strong bullish intentions. The rising metrics, along with price, puts buyers in good stead to advance LINK’s bullish rally.
Source: Coinglass
