Chainlink price to revisit $16 as LINK coils above vital support

Chainlink price has shattered a few weekly resistance barriers and is currently hovering above a crucial, pivotal point. A bounce off this barrier seems likely but might come after LINK undergoes a minor retracement.

Chainlink price attempts comeback

Chainlink price has dropped roughly 65% in the last three months from roughly $38 to $11. This massive downswing has flipped many weekly support levels into resistance barriers and is currently retesting the daily demand zone, extending from $10.82 to $13.06.

Although LINK looks primed for a move higher, it might dip further lower inside the said demand zone before heading higher. The first hurdle bulls will encounter is the $14.97 ceiling; clearing this impediment will allow market makers to push LINK beyond $15.70 to collect the buy-stop liquidity resting above it.

In total, this move would constitute a 20% ascent and is likely where the upside is capped for LINK.

LINK/USDT 4-hour chart

IntoTheBlock’s Global In/Out of the Money (GIOM) model paints a vivid picture supporting the technical perspective for Chainlink price. The immediate resistance cluster extends from $13.55 to $15.02, where roughly 33,080 addresses that purchased nearly 35.69 million LINK tokens are “Out of the Money.” Therefore, a move into this area is likely to be met with selling pressure from holders trying to break even.

As for the downside, the immediate support cluster is relatively weaker, so there is a chance Chainlink price might dig deeper. In such a case, the GIOM model shows that any retracement will likely be supported by “In the Money” buyers at $10.50 that purchased nearly 30 million LINK.

LINK GIOM

While the upside for Chainlink price seems limited, it is understandable considering how inactive the crypto markets have been lately. This development can be seen by LINK as the number of new addresses joining the Chainlink blockchain has dropped from 1,500 to 660 in the last three months. 

This 56% drop suggests that investors are not interested in LINK at the current price levels.

LINK new addresses

Regardless of the bullish outlook, if LINK produces a daily candlestick close below $10.82, it would create a lower low and invalidate the bullish thesis. In such a case, Chainlink price might explore lower levels.