Chainlink’s downtrend could stop if this support holds
Crypto has come into focus over the last few days after a major crash. Most coins have been on free fall, LINK included. But contrary to the doom and gloom out there, a complete crypto collapse is highly unlikely. LINK in particular has a real chance of stopping the downtrend, but it will need to hold a very important support level. Here are some facts to keep in mind:
LINK dropped nearly 40% in two days this week
The coin has recovered a bit from these losses but still remains weak
If LINK can maintain the price above $6.10, it can avert a major downside
Data Source: TradingView
Will the support hold?
The big question for most bulls is whether there is enough confidence in the market to avert another sell-off. After the Fed made a commitment to fight inflation with an aggressive interest rate hike, risk assets saw a major boost. But there are fears this short-term rally is not going to last.
So, for LINK to maintain the $6.10 support, it will need to at least avoid a 10% decline over the coming few days. While this is possible, based on overall sentiment in the market, there is still a risk that the support could be breached.
If this happens, the next strong support will be around $4.5. This would represent a 40% drop from the current price. But if $6.10 holds and the price action consolidates around it, LINK could surge above $8 by the end of trading this week.
Major Ecosystem updates for LINK
Although the downtrend in recent weeks has been quite disappointing, LINK has been doing very well in building up its ecosystem. New plans on staking have already been rolled out, and the project has signed major partnerships.
From a fundamental point of view, things are looking good for LINK. The only thing needed now is for sentiment to turn around in the broader market.