Chainlink price at risk as Powell hearing has Capitol Hill focused on cryptocurrencies
|- On Tuesday and Wednesday Powell had his semi-annual hearing on Capitol Hill.
- LINK tanked the past few days on the back of Powell’s outlook and request for more monitoring of cryptocurrencies.
- Altcoin traders are set to price in another risk premium as more regulatory scrutiny could get underway in the coming months.
Chainlink (LINK) price tanked again this week as altcoin traders did not love the fact that all eyes were on cryptocurrencies during a part of the Senate semi-annual hearing with US Fed Chairman Jerome Powell. A segment of his hearing was devoted to cryptocurrencies and concerned which areas Powell would like to have more monitoring. Without any doubt, Powell called out stablecoins and asked Congress for more harsh and strict monitoring to avoid systemic risks and domino effects that could spill into the real economy.
Chainlink price set to tank 13% on coming regulatory pressure
Chainlink price could slide below $6 as investors may unwind their stakes in LINK. Returning to Tuesday and Wednesday, Fed Chair Powell asked Congress for more severe monitoring of one segment of cryptocurrencies. The segment at hand is stablecoins, where Powell would like a stricter regulatory and financial framework to protect against the risk of crypto spilling over into the US economy and causing a US bank to default.
LINK will see traders price in more uncertainty in its price action. Expect to see another 6% decline toward the monthly S1 support level, near $6.27. Should the legal framework also contain decentralized coins, expect that to be a massive game change with LINK set to slide toward $5.70.
LINK/USD 4H-chart
Of course, the part on stablecoins was only a minor part of the Senate hearing. Expect the dust to settle with no big changes in the coming months, which opens a window for recovery up toward $7. The Relative Strength Index is a second reason why price action in LINK can climb higher as it is currently glued to the oversold barrier.
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