The cryptocurrency market is signaling the start of a new bull run, with multiple digital assets nearing breakout points. As of today, November 8, 2024, Chainlink (LINK) is demonstrating a strong bullish potential. The formation of a promising price action pattern suggests that LINK is on the cusp of a breakout.
Chainlink (LINK) Technical Analysis and Key Levels
In an analysis of Chainlink’s daily price movements, a bullish ascending triangle pattern has been identified. This pattern is a strong indicator that LINK is on the brink of a breakout. Historical momentum and recent price behavior suggest that if LINK’s price climbs and closes with a daily candle above the $13.10 level, there is a significant chance it could surge by 18%, potentially reaching the $15 mark in the near future.
At present, LINK is trading above the 200 Exponential Moving Average (EMA) on the daily chart, which is a positive signal. The 200 EMA is a key technical indicator used by traders and investors to ascertain the trend of an asset, whether it is moving upward or downward. A position above this moving average typically indicates a bullish trend, prompting traders to adjust their strategies accordingly.
However, LINK’s bullish potential hinges on its ability to close with a daily candle above the critical $13.10 level. Failure to do so may result in the bullish thesis losing its validity.
Bullish On-Chain Metrics
The on-chain metrics reinforce LINK’s bullish outlook. According to data from Coinglass, an on-chain analytics firm, the Long/Short ratio for LINK on Binance is at 2.10. This ratio reflects a strong bullish sentiment among market participants. Moreover, LINK’s open interest has increased by 7.9% over the last 24 hours and 2.5% over the past four hours. This rise in open interest suggests growing trader engagement and an increase in positions, correlating with the optimistic market outlook.
Currently, a significant majority of top traders, 73.02%, are holding long positions, while the remaining 26.98% are in short positions. At the time of writing, LINK is trading around $12.55, having experienced a price increase of over 4.36% in the past day. Interestingly, despite this price surge, its trading volume has decreased by 23%, indicating reduced trader participation amidst the potential breakout.
In conclusion, the overall market sentiment for Chainlink appears to be optimistic, with technical patterns and on-chain metrics aligning to suggest a favorable breakout scenario. However, traders should remain vigilant and watch for confirmation of the breakout at the $13.10 level to sustain the bullish narrative.
