Chainlink at a Crossroads: Breakdown Ahead or Breakout Past Resistance?

• Chainlink has dropped over 3%, currently trading at $13.
• LINK’s daily trading volume has surged by more than 80%.

The 1.49% drop in the crypto market cap has pushed the assets into the red territory, losing their recent gains. All the major altcoins have lost momentum and are trading on the downside. Following the suit, Chainlink (LINK) has dropped a solid 3.26% over the past 24 hours. 

LINK kicked off the day trading at its daily high at around $14.14. Despite gaining more strength on the upside, the altcoin displayed a downside rally. Later, the asset has plunged toward a low of $13.20, with the bearish shift. At the time of writing, Chainlink trades within the $13.23 level, with its market cap reaching $8.69 billion. 

In addition, the asset’s daily trading volume has increased by over 80.10%, touching $472 million. As per Coinglass data, over $1.02 million worth of Chainlink was liquidated in the market in the last 24 hours. 

The weekly chart of LINK has recorded a drop of over 13.28%. The asset’s weekly high was marked at around $15, and the potent bears have pulled the price back to the $12 range. 

Can Chainlink Plunge Further?

LINK’s four-hour trading chart reveals a sturdy downward momentum, and the price may slip toward the $13.15 range. An extended correction on the downside could trigger the death cross emergence. The asset might plunge to the former lows below the $13 threshold. 

However, a positive breakout of the asset above $13.31 could likely climb and test its crucial resistance at the $13.40 level. Further upside correction of Chainlink might push the price up to its recent highs. Gradually, it may invite the golden cross to unfold. 

While zooming in on the technical chart, the Moving Average Convergence Divergence (MACD) line and the signal line have crossed below the zero line. This crossover points out that the downward momentum is gaining strength. Moreover, the Chaikin Money Flow (CMF) indicator is found at 0.03, hinting at mild buying pressure in the market. Also, the money is flowing into the asset, and a sustained rise could strengthen the trend.

Furthermore, the daily relative strength index (RSI) is positioned at 42.21, suggesting a neutral-to-bearish sentiment, with selling pressure in the market. Besides, Chainlink’s Bull Bear Power (BBP) value at -0.42 indicates that the bears are currently stronger than the bulls. If the value continues to drop, a deeper correction is ahead.

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