Weakness Builds for Chainlink (LINK): Will the $5 Support Floor Give Way to Risk?

• Chainlink is hovering around the $8 mark.
• LINK’s trading volume has decreased by 16%.

Today, at press time, the crypto assets are charted in the red, nurturing the bearish tone, shedding by over 2.65% in market cap, reaching the $2.35 trillion mark. With the market-wide extreme fear, the majority of the digital assets have been losing momentum continuously. Notably, Bitcoin (BTC) has slipped below $70K, and Ethereum (ETH) is at $2K. 

Meanwhile, Chainlink (LINK) has plunged by over 4.25% in the last 24 hours. In the morning hours, the asset traded at a high range of $9.02, and after the bearish wind strengthened, the LINK price slipped to a bottom level of $8.47. Chainlink is currently trading at around $8.59, with the daily trading volume having dropped by 16.21% to $587.1 million. 

The trading pattern of Chainlink is bearish, and the price may fall toward the crucial support at $8.49. If the correction on the downside gains more strength, the asset’s price could retrace toward its low at around $8.39 or even lower. Upon a reversal in the Chainlink market momentum, the price might climb to the nearest resistance at the $8.69 level. Further bullish pressure could trigger the price up and push for a retest of the price above the $8.80 range.

Chainlink’s Technicals Turn Cautious as Bearish Signals Emerge

Both the Moving Average Convergence Divergence (MACD) line and the signal line of Chainlink are below the zero line, showing that the bears are still in control. Any upside moves are corrective rather than trend-reversing. A sustained shift above the zero line will confirm a stronger uptrend. 

LINK chart (Source: TradingView)

Besides, the Chaikin Money Flow (CMF) indicator is settled at 0.23 hints at strong buying pressure in the LINK market. The capital is flowing into the asset, displaying accumulation and demand. As long as it stays above zero, it supports the bullish bias and increases the odds of more upside.

Chainlink’s current market sentiment is neutral-to-bearish as the daily Relative Strength Index (RSI) is found at 41.48. It is not oversold yet, but the buying strength is weak. If it moves back above 50, the momentum shifts in favour of bulls; otherwise, sideways or downside action may continue. 

Furthermore, the Bull Bear Power (BBP) reading of LINK at -0.36 exhibits that the bears currently have the upper hand. As the sellers are pushing the price below, it reflects downside pressure. If the value moves to zero, it weakens bearish control and brings a possible shift in momentum.

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