Chainlink saw a bout of capitulation yesterday that came about after a multi-week downtrend. This came in the form of a sharp decline that sent its price reeling from highs of $20.00 to lows of nearly $7.00 before it found some strong support.
The cryptocurrency’s lackluster price action has struck a serious blow to its technical outlook, but the rebound seen from its overnight lows could still mark a long-term bottom.
Since dipping towards the lower-$7.00 region, LINK’s price has been able to climb up to highs of over $9.00.
Because of the intensity of this move, one analyst who had been previously forecasting a capitulatory drop is now predicting that Chainlink could now be forming a long-term reversal.
If this is the case, then it may soon be able to start a fresh uptrend that leads it back up towards its previous highs.
Because the crypto tends to trade independent from the aggregated market, it may rebound regardless of how Bitcoin and other digital assets are trending.
Chainlink Posts Intense Rebound from Daily Lows
At the time of writing, Bitcoin is trading up just under 20% at its current price of $9.10. This marks a massive climb from its recent lows of $7.40 set at the bottom of the recent selloff.
These lows came about in the form of a sudden decline, as LINK was previously consolidating around $8.50 before it incurred massive inflows of selling pressure that caused its price to plunge.
These lows were visited on two occasions before bulls took control and catapulted it to its current price.
Its strength is showing few signs of slowing down, highlighting just how oversold it was earlier today.
Analyst: LINK Poised to See a Bullish Trend Reversal
While speaking about the potent reaction to $7.40, one analyst who had been closely tracking Chainlink’s downtrend explained that it does appear that this could mark a trend reversal.
“I always appreciate a bounce – given the chance – to get out at breakeven when your setup failed and price started [moving] around where you did not want it to. That said, this looks good for a reversal…”
Image Courtesy of Bitcoin Jack. Chart via TradingView.
If Chainlink can sustain its current momentum, the token could be well-positioned to see significantly further upside in the coming days.
Featured image from Unsplash. Charts from TradingView.