Why LINK may rally up into another week

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Chainlink’s rebellion has extended into another week after becoming the only coin among the top 20 with a positive weekly Return On Investment as per CoinMarketCap. Its massive rally can be attributed to a major support trendline that has been active since July 2020. A potential golden crossover on the daily time frame combined with bullish on-chain metrics added more credence to LINK’s scintillating run. At the time of writing, LINK traded at $26, up by 0.04% over the last 24 hours.

Chainlink Daily Time Frame

Source: TradingView

Chainlink’s price was set to extend its value on the chart after breaking north of a symmetrical triangle setup. Its price was yet to meet the breakout target at $30.2, which was set by the height of its triangle. Its bullish near-term bias was also reinforced by favorable readings on the MACD and RSI.

Should a golden crossover between the 20-SMA (red) and 200-SMA (green) develop over the coming days, LINK would be in a good position to overcome selling pressure at the 61.8% Fibonacci level. A further 22% surge would bring LINK to a major supply zone around $36.5. Expect a period of correction once LINK tags this barrier.

Meanwhile, the combination of the daily 200-SMA (green) and 38.2% Fibonacci level should contain any pullback attempts. However, long setups should be foregone if LINK manages to close below its daily 200-SMA.

Indicators

The daily RSI was forming a fresh higher low before making its way to the overbought territory. The minor pullback could see LINK settle at the 38.2% Fibonacci level over the near term. This ‘healthy’ dip would also encourage those who are late on LINK’s bull run to initiate new longs.

Higher peaks on the Squeeze Momentum Indicator were another plus. The reading suggested that bulls were increasing their presence in the market.

Conclusion

Once a slight dip at the 38.2% Fibonacci level is complete, LINK was expected to resume its uptrend and complete its breakout target at $31.7. From there, a golden crossover between the 20 and 200 SMA’s can help LINK rack up a further 17% hike before sellers hit back with a correction.

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