Chainlink (LINK) is showcasing renewed promise following a recent retest of a crucial support level, indicating that bulls may be preparing for the next phase of the upward trajectory. The latest bounce from this key support area, which previously acted as a barrier, reinforces the notion that this level has now solidified into a strong foundation.
This rebound bolsters the strength of the support and presents a compelling case for a potential upside movement. As LINK stabilizes above this key level, market participants are keenly watching the next resistance zones that could dictate the near-term direction. With momentum gradually rebuilding, the stage may be set for a breakout that captures the broader market’s attention.
Chainlink Holds Strong: Breaking Down The Critical Support Retest
Recent insights from Jimmy X, shared in a post on X, highlight that Chainlink has emerged from a falling wedge pattern on the daily chart, a formation often associated with bullish reversal signals. This technical development is garnering attention as it hints at a potential shift in momentum following a phase of downward consolidation.
Jimmy pointed out that LINK is currently testing the upper trendline resistance of the wedge, accompanied by a steady increase in trading volume—a strong indication that buyers are entering the market with conviction. An uptick in volume during a breakout typically reinforces the legitimacy of the move, suggesting that this may not merely be a fleeting spike but rather the onset of a longer-term upward trend.
He further emphasizes that a confirmed breakout followed by a successful retest of the former resistance as support could pave the way for a parabolic move for Chainlink. This bullish setup, often seen as a launchpad for accelerated rallies, positions LINK to target several upside levels.
Key resistance points to monitor include $15.40 and $17.50, which have previously functioned as obstacles during earlier price increases. Beyond these thresholds, $20.00, $23.80, and $26.50 are also notable targets. With technical indicators aligning and market sentiment shifting, a sustained move above the breakout zone may set the groundwork for an extended rally.
Downside Potentials
While Chainlink’s recent retest of support exhibits bullish promise, it’s vital to also consider the potential downside risks if momentum falters. Should the price fail to uphold its current structure, the first line of support rests around $12.50. This area has historically been a strong demand zone, and a breakdown here could signal the beginning of a deeper correction.
Subsequently, the $11.10 level emerges as another critical benchmark. This zone represents a prior consolidation area and aligns with the lower trendline of the broader ascending channel, forming a vital structure for bulls to defend. A breach beneath this level could pave the way for a retest of the psychological $9.28 mark, where the market may make another attempt to establish a solid base.
