Chainlink (LINK) has been experiencing a lack of investor interest due to trading within a narrow range lately. However, the altcoin managed to experience a slight 1.5% increase in the past 24 hours, which indicates sideways movement. Despite a 4% upward move recorded on the weekly chart, the technical analysis shows that the bears still control the price action, with low demand and accumulation levels. Although there was a slight increase in buying activity on the daily chart, sellers still dominate the market.
The price decrease in Bitcoin, which dropped below $27,000, has caused uncertainty among altcoins, preventing them from making decisive moves on their respective charts. A price breakout is possible following a period of consolidation. While the technical outlook suggests bearish strength, there are also signals of a potential reversal, depending on broader market strength. However, LINK’s market capitalization decline reflects weak buying power.
At the time of writing, LINK was priced at $6.78 as it attempted to break its sideways trading pattern while remaining below its resistance level of $6.90. A successful breakthrough would lead to a rally toward $7.20. A fall from its current level could cause a decline to $6.30 and potentially push the price below $6. However, as long as LINK remains above the local support line at $6.60, it has the potential to continue its recovery on the chart. The volume of Chainlink traded in the previous session was positive, indicating that buyers may be starting to re-emerge in the market.
Following sustained selling pressure, LINK is now attempting to attract buyers back into the market. The Relative Strength Index (RSI) has been trending upward, nearing the halfway point, but, at present, sellers still outnumber buyers. Furthermore, LINK is attempting to trade above the 20-Simple Moving Average (SMA) line, indicating renewed demand in the market. Even though the coin is making recovery attempts, sellers still drive the overall price momentum.
A buy signal emerged as the price and buying strength of LINK aimed for recovery. The Moving Average Convergence Divergence (MACD) formed a green signal bar, aligned with a buy signal, indicating positive price movement potential. Additionally, the Bollinger Bands are wide and parallel, suggesting that the coin will likely attempt a breakout from its previous consolidated price action.
In conclusion, Chainlink’s price movement depends on broader market strength as it copes with weak buying power. Nonetheless, it shows signs of a potential reversal, with bid signals for recovery visible, though sellers currently drive the overall price momentum. The altcoin market remains uncertain, with the possibility of a price breakout following a period of consolidation.