Chainlink (LINK): Buyers Should Consider This Before Executing Longs
The battle to expedite the previous bullish run saw Chainlink buyers provoking a month-long climbing wedge upsurge until mid-August. However, bears secured renewed selling strength near the $9.2 ceiling, the narrative that persisted within the last three months.
Meantime, LINK struggled to stabilize beyond the daily Exponential Moving Average ribbons. The current setup might catalyze a near-term drop before buying comebacks. While publishing this post, LINK changed hands at $6.866, dropping 5.6% within the previous 24 hours.
Chainlink Daily Timeframe
Chainlink buyers regained the $8 mark since dropping towards 2-year lows on June 13. Meanwhile, the rally was temporary following the anticipated climbing wedge breakdown. Consequently, the price action plunged beneath the Exponential Moving Average ribbons, confirming a selling superiority. Meanwhile, possible reversals might trigger a slow-moving period, as the support at $6.7 poses a short-term obstacle for sellers.
Such cases might see price action hovering around the POC (Point of Control) before trend-shifting moves. A possible closing beneath $6.7 might open the path for LINK to test $6.3. that would see buyers striving to keep their edge. However, a decisive bearish cross on the Exponential Moving Average ribbons might bring a conducive environment for bears.
Reasoning
The RSI (Relative Strength Index) dipped into bearish territory during this publication. The indicator has exhibited sideways moves and should reclaim a position beyond the midline to highlight buying superiority in the long term.
Moreover, the CMF (Chaikin Money Flow) mimicked the RSI, depicting weak buying momentum. A sustained spot beneath the zero level might slow down the buying strength. Furthermore, the Directional Movement Index’s negative DI maintained northbound actions. Meantime, buyers should wait for a possible bullish cross from the +DI before executing longs.
Final Thought
The bearish flag pattern plus indicators’ weak reading plus low volumes put Chainlink’s LINK in a fragile situation. Buyers should join to protect $6.7 to avoid more losses. Targets would stay as mentioned. Possible bearish invalidations might witness a slow phase around the Point of Control. Lastly, investors should analyze broad market actions for profitable moves.
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