Chainlink (LINK) price is showing bullish signs on the weekly and daily time frames. It is approaching a key long-term resistance level.
LINK is the native token of Chainlink, which uses a decentralized oracle network to allow the blockchain network to interact with external data feeds. It was created by Sergey Nazarov. Since hitting an all-time high of $53 in May 2021, Chainlink price has been falling below a descending resistance line.
The decline ended at the June 2022 low of $5.30. Since then, the price has been trading very close to the $6.10 horizontal support area. Recently, LINK price formed a long lower wick and a lower high (green icon), which can be considered as the first move in a bullish structure.
Furthermore, the weekly RSI has formed a bullish divergence for the entire period. The indicator has now moved above almost 50.
If the rise continues, the resistance line at $8 is expected to provide resistance. A breakout from the line could take the price towards the $14.90 resistance area.
Chainlink (LINK) divergence and reclaim boost bullish sentiment
Technical analysis from the daily time frame provides a more bullish outlook. The price rallied from March 10 and broke above the descending resistance line four days later. Then, it validated both the resistance line and the $6.55 area as support before moving higher. This entire movement happened after the price diverged below the $6.55 area. Lastly, the daily RSI has moved above 50.
All are bullish signs that suggest the trend is bullish. Currently, LINK price is facing a resistance from the 0.5 Fib retracement resistance level at $7.15, which caused a rejection in the last 24-hours. Once it manages to break above, it could reach the long-term resistance line at $8.
To conclude, weekly and especially daily time frame is bullish to read. They suggest a move towards $8, and a potential breakout is likely. If they materialize, LINK token price could rise to $14.90.
On the other hand, if the rally loses momentum, the price could decline back towards the $6.10 support area. A close below $6.55 would confirm this.
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