Chainlink Pushes Above $7, Will The Short-Term Recovery Hold?

The price of Chainlink had been in a period of consolidation over the past few sessions. However, the bulls were recently able to break above an important resistance level. Despite this recent bullish action, the daily chart showed a 6% depreciation and on the weekly chart, LINK had a 9% loss. The technical outlook looked bleak with fading demand and low accumulation. Nevertheless, if LINK can remain above the $7 mark, another rebound may be possible. As Bitcoin displayed mild bullish sentiment after reclaiming the $28,000 mark, most altcoins exhibited similar behaviors. Related Reading: Ethereum Exchange Inflows Trigger Drop Below $2,080: Will It Slide Lower This Week? If BTC retraces in the next trading sessions, LINK is expected to move closer to its immediate support level. Maintaining buying strength is crucial for the asset to stay above its local price floor. The market capitalization of LINK had fallen, indicating that sellers were more active. Chainlink Price Analysis: One-Day Chart At the time of writing, Chainlink was trading at $7.02, with its immediate resistance at $7.40. If the altcoin manages to surpass this resistance, it will encounter a tough price ceiling of $7.70, and reaching that level may revive the bulls. Conversely, failing to stay above the $7 mark will pull Chainlink down to $6.80. If this happens, LINK may decline by up to 15%, nearing the $5.80 mark. The last session saw a decrease in the amount of LINK traded, and indicators suggested that buying strength was weakening. Technical Analysis Chainlink had experienced a sharp drop in buyers’ interest after encountering significant resistance at $7.70. However, demand for the altcoin could partially return if it moves above the $7.00 price mark. The Relative Strength Index was below the half-line, hovering around 40, indicating that sellers had taken control of the market. Additionally, LINK had fallen below the 20-Simple Moving Average line, signaling that sellers were driving the price momentum at press time. If demand picks up, LINK could rise above the 50-SMA line (yellow), providing some relief to the bulls. In line with the other technical indicators, LINK displayed sell signals, indicating a bearish turn in price. The Moving Average Convergence Divergence (MACD) demonstrates an asset’s price momentum and trend reversals as well. The MACD formed red histograms below the half-line, signaling a sell signal for the asset. The Parabolic SAR reads the price direction and changes in the same. The indicator formed dotted lines above the price candlesticks, suggesting a downtrend in the price. Related Reading: Render (RNDR): Biggest Gainer Among Top 100 Cryptos With A 22% Climb For LINK to maintain its price above the $7 mark, buying strength needs to resurface over the immediate trading sessions, and broader market strength has to remain consistent. Featured Image From UnSplash, Charts From TradingView.com