Chainlink price surged to a six-month high and then suffered a harsh reversal amid the ongoing crypto market crash. LINK token plunged to a low of $22, down by 12% from its highest point this year. This article explores whether this is a temporary setback or the start of the downward spiral.
Chainlink Price Technical Analysis
The daily timeframe chart reveals that the LINK price surged to the multi-month high of $24.7 and then pulled back to $22. This crash happened after it formed an evening star candlestick pattern, which normally leads to a bearish reversal.
Chainlink price recently formed a golden cross pattern, with the 50-day and 200-day moving averages flipping each other. There are also signs that it is in the third phase of the Elliot Wave pattern, which is usually the longest. This pattern means that the ongoing pullback is just temporary.
Therefore, the most likely scenario is where the LINK price resumes the uptrend as it continues the third phase of the Elliot Wave. More gains will be confirmed if it moves above this week’s high of $24.7.
A move above that level will indicate further gains to $ 25.60, the target of the double bottom at $10.99.
LINK price chart | Source: TradingView
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Chainlink Has Solid Fundamentals
LINK price has numerous catalysts that may drive it higher in the coming months. First, the Securities and Exchange Commission (SEC) will likely approve ETFs by Tuttle Capital, a move that will lead to more inflows from American investors. There are also odds that other companies will file for a LINK ETF.
Second, Chainlink’s role in the crypto industry is becoming more pronounced. It already dominates in the oracle industry, where it connects off-chain data to the on-chain. This growth will accelerate in the era of tokenized stocks.
More companies are also embracing Chainlink’s solutions. For example, Maple Finance is using its Cross-Chain Token (CCT) standard for the syrupUSDC, which recently passed the $2 billion in assets under management.
Third, Chainlink price will benefit from the recently announced LINK reserve news. In this, the company announced that it will start to repurchase LINK tokens using the on-chain fees and other enterprise fees.
The reserve has so far accumulated 109,662 LINK tokens currently valued at over $2.4 million. This is impressive for a feature that was launched last week.
Chainlink price will also benefit from the real-world asset (RWA) industry, which is one of the fastest growing industries. It has partnerships with some of the biggest companies, like UBS and Coinbase.
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