Chainlink On The Cusp Of Critical Weekly Close, Further Breakdown Imminent

Tony "The Bull" Severino

Last Updated: June 11, 2024 2:07 pm

3 mins read

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Chainlink is now trading at half of the price it was at just months ago, after entering price discovery mode and setting new high after high.

If the once-unstoppable altcoin cannot close this week’s candle above $11 per LINK token, then its price could sink a lot further instead.

Why Chainlink’s Weekly Close Is Its Most Crucial Yet

Chainlink’s 2020 has been even brighter than it has been for Bitcoin or Ethereum by far. Even after dropping more than 50% from highs, the altcoin still has over 400% ROI to show for its year-to-date climb.

Even a dive to $1 on Black Thursday was bought up with extreme fury, and the rebound effect in part helped propel Chainlink to a new peak after peak throughout the year.

After touching $20, however, things came crashing down, and the altcoin has been left reeling since. Several attempts to return to highs have been swatted down, even with Bitcoin is as bullish as can be.

Now, Chainlink is back trading at just $10 and is on the cusp of an especially critical weekly close that could send the altcoin downward spiraling further.

The decentralized oracle altcoin losing the middle Bollinger Band could be deadly | Source: LINKUSDT on TradingView.com

LINKUSDT Could Fall Another 40% From Current Levels

As pictured above, LINKUSDT has begun to break down below the middle-line moving average on the Bollinger Bands technical analysis indicator.

A candle close through the middle-BB either way, is considered a buy or sell signal, and a large move often results. Note in the chart above, the candle close above the middle-line is what sent Chainlink into overdrive in 2020.

The tool has been so effective at acting as a sell signal for LINKUSDT in the past on weekly timeframes, that out of five prior times the asset closed below, it resulted in an on average decline of 43%. Corrections range from 20% to 70%, putting 43% just about right smack in between the two stats.

The decentralized oracle altcoin losing the middle Bollinger Band could be deadly | Source: LINKUSDT on TradingView.com

A 43% fall from here, would put Chainlink at about $6, which was the last touch of support before the altcoin took off on a parabolic rise to $20.

Some analysts claim that parabola isn’t over, but even $6 might not be the final bottom if they are wrong. According to experts such as Peter Brandt, who accurately called Bitcoin’s 84% decline a year in advance, claim that any asset that loses such a powerful trajectory is bound to decline by nearly as much.

A full 84% retracement in Chainlink, just like Bitcoin did, would take it to $3. Falling 90% or more as other altcoins have would bring the cryptocurrency back to a buck and a half per LINK.

While that might sound shocking for such a promising cryptocurrency, remember, all cryptocurrencies have experienced such drawdowns in their lifetimes. Except for maybe Chainlink – why will it be any different?

Featured image from Deposit Photos, Chart from TradingView.com

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

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Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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