- On May 27, Chainlink (LINK) achieved its highest price in 57 days.
- LINK broke out from a 65-day descending resistance trend line and a short-term ascending parallel channel.
Chainlink’s recent price surge is making waves in the cryptocurrency market, signaling a potential end to its correction phase and prompting speculation of further gains ahead, potentially reaching the $20 mark. Here’s a detailed look at what’s driving this surge and what it could mean for investors:.
Chainlink Signals End to the Correction
Chainlink’s price movements have been closely watched, particularly following its breakout from a 65-day descending resistance trend line and a short-term ascending parallel channel. These developments have led analysts to believe that the correction phase for Chainlink may finally be over. The recent high of $18.83 on May 27 marks a significant milestone for LINK, which struggled to break free from its correction since hitting a low of $11.96 on April 13.
The bullish sentiment is further supported by technical indicators, with the LINK price now trading near the 0.618 Fibonacci retracement resistance level. Breaking through this key resistance could pave the way for further gains, potentially setting sights on the $20.73 level, just shy of its yearly high.
What is Chainlink’s Tokenization Fund?
A major catalyst for Chainlink’s recent bullish trend has been its partnership with the Depository Trust & Clearing Corporation (DTCC), along with other financial institutions. This collaboration aims to facilitate fund NAV data delivery across any blockchain, leveraging Chainlink’s CCIP to ensure secure on-chain asset settlement.
Tokenization initiatives have been gaining traction in 2024, as traditional finance institutions like JPMorgan and Franklin Templeton explore ways to utilize on-chain data for creating tokenized funds and smart contracts. This move has significant implications for brokerage portfolio applications and automated data dissemination.
LINK Breaks Out After Bullish Pattern
After struggling under a descending resistance trend line for nearly two months, Chainlink’s price action finally turned bullish on May 15, breaking out from the resistance trend line and confirming a triple-bottom pattern. This pattern, combined with bullish divergences in the daily RSI and MACD indicators, reinforced the belief that the correction phase had ended.
The subsequent bullish momentum pushed LINK to break out from a $16.10 Fibonacci resistance area, setting its sights on the $18.70 resistance level. The positive price action not only affirmed the bullish trend but also highlighted the potential for further upward movement.
LINK Price Prediction: Will the Increase Continue?
As of now, the daily price action and indicator readings for Chainlink are decisively bullish. Analysts are considering various wave counts, with the most likely scenario suggesting that LINK has completed an A-B-C structure and is now in a new five-wave upward movement. Confirmation of this count will depend on whether Chainlink can break through the short-term ascending parallel channel.
However, there is also a bearish count suggesting that the increase is part of a corrective structure, which could lead to a decline if resistance levels aren’t overcome. The reaction to the resistance trend line will be crucial in determining the next major trend for Chainlink.
Conclusion
Chainlink’s recent price rally and bullish technical indicators suggest that the cryptocurrency may be poised for further gains after breaking out from key resistance levels. The partnership with DTCC and other financial institutions to facilitate tokenized funds and smart contracts has also fueled optimism in the market. Investors and analysts will closely monitor whether Chainlink can sustain its bullish momentum and break through the $20 resistance level, which would mark a significant milestone for the cryptocurrency in 2024.
