Chainlink, a popular cryptocurrency token, may be on the verge of a bullish breakout after testing a key resistance level.
Current Situation with Chainlink
Last week, Chainlink was trading at a key resistance level of $12.60, up from a low of $10.15 at the beginning of the month. A major factor contributing to this is the increasing outflows of tokens from exchanges as investors move their assets to self-custody. According to Nansen data, Chainlink holdings on exchanges decreased by 1.1% over the past seven days.
Technical Price Analysis
The chart shows that Chainlink has been in a strong downtrend for several months, falling from a high of $30.80 in November to a low of $10.15. The current resistance level that has been tested has persisted since February 13. Additionally, a falling wedge-like pattern is forming, which often signals a potential trend reversal.
Future Prospects of Chainlink
Furthermore, Chainlink has formed a bullish divergence; the MACD indicator continues to rise and is approaching the zero level. The Relative Strength Index and Awesome Oscillator are also trending upwards. Therefore, it's possible that the token may break out upwards soon, targeting a level around $15, approximately 15% above the current price.
In light of the current market activity and technical analysis, Chainlink appears poised for a bullish rally if current trends continue.
