Chainlink outperforms Litecoin, LINK hits new high above $24
Chainlink has entered a price discovery phase, likely due to rumours that Grayscale will soon launch a fund based on
Chainlink (LINK) remains one of the best performing cryptocurrencies over the past twelve months. On January 23, LINK surpassed Litecoin (LTC), taking the seventh position at a market capitalisation of $9.2 billion, after overtaking Bitcoin Cash a few days ago.
The rise in LINK’s price coincides with rumours circulating this week that Grayscale is preparing to add a new product, Chainlink Trust. This news has Bitcoin Future likely helped push the price of Chainlink to new all-time highs, making LINK once again one of the most profitable cryptocurrencies.
What is the decisive support level?
Chainlink’s daily chart shows tremendous volatility in recent months, but also magnificent price action. Every previous resistance level has turned into support, after which the price has continued to rise almost by the book.
Many people feel the urge to open a position when the price is rising, but these support-resistance reversals actually offer the best entry points. Specifically, the first support-resistance reversal occurred at the $10 level, then the same occurred at the $13 and $17.30 areas.
Consequently, the crucial level to watch for a potential decline is the $17.30 level, as well as the $19.50 level. The latter corresponds to the previous all-time high marked in 2020, and possibly the point where we will see the next support-resistance reversal, which would suggest a further rise.
Possible highs for Chainlink price
As Chainlink is in a price discovery phase, it becomes difficult to define the next potential points of interest of the highs structures. However, Fibonacci extensions are used by traders to determine these areas.
According to this indicator, the first zone is located between $29 and $31, which aligns with both Fibonacci extensions. The second corresponds to the 2.618 Fibonacci extension, at $39, and the last one points to $42.
Either way, the next wave of momentum is likely to see a big rally in the LINK-Bitcoin (BTC) pair. The recent rally has been led by Bitcoin, while the altcoin-BTC pairs have remained relatively flat.
When Bitcoin ends its correction and starts moving slowly upwards, the likelihood of better performance for altcoins increases.
LINK/BTC encounters a major resistance zone
Over the past few weeks, altcoin-BTC pairs are waking up from their hibernation, but it’s not yet time to announce the new „altseason.“ The altcoins need to consolidate and gather strength for the next rally.
For Chainlink, this build-up is visible on the left side of the chart. LINK’s price stayed within an accumulation range for a long time before starting its latest climb.
Bitcoin’s price will have to remain stable to allow such a large build-up. Otherwise, BTC’s volatility will have an even deeper impact on less liquid altcoins.
LINK/BTC is facing crucial resistance. If it fails to break above 0.00074000 sat, new tests of the levels at 0.00055000 and 0.00041000 sat will become possible.