LINK’s rally: Is this the crest or just a pitstop?

But as the saying goes, what goes up must come down... or at least take a breather.  LINK is beginning to find some resistance and looks exhausted to the upside. 

TLDR

• LINK is encountering resistance and showing signs of exhaustion in its upward movement.
• Technical analysis reveals potential bearish divergence, with higher highs in price and lower highs on the oscillator.
• Major support for LINK is at the $9.67 horizontal level, with caution advised due to overheated indicators.
• Unless Bitcoin (BTC) sees upward movement, it is doubtful that we will see any additional significant gains for LINK– a pullback is more likely.

Disclaimer: Not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results. “One Glance” by Cryptonary sometimes uses the RR trading tool to help you quickly understand our analysis. They are not signals, and they are not financial advice.

Technical analysis

LINK on the 12-hour timeframe is showing signs of exhaustion, with sellers coming in north of $11. Note the large wicks on the upside in the chart. Regarding technical formations, this is set up similarly to SOL in that there are no pennants, flags, etc. Instead, all we have are higher highs in price with lower highs on the oscillator. 

For now, the most major support below price is the $9.67 horizontal level. If price does have a more meaningful pullback, we’d expect this level to hold in the near term.

LINK 12-hour 

RSI and funding rates

As mentioned above, price is forming higher highs while the oscillator is forming lower highs but it is still in overbought territory. This is a bearish divergence; we’re now close to forming another. This should tell us to be cautious here. 

Funding is still very positive, and open interest is very high. This also shows a slightly overheated market here.

Cryptonary’s take

Unless BTC moves higher, we doubt we’ll see further significant upside for LINK soon.  From here, we expect a pullback for LINK - assuming BTC doesn’t throw any major surprises. 

Action

• Many of the indicators are heavily overbought. 
• LINK is up 60% in less than a week. Moves that go straight up aren’t usually sustainable, so we’d be wise to expect at least some form of pullback in the near term or even a greater correction in the medium term. 
• We eye the $9.67 level as a short-term correction and the mid $8’s for a longer-term correction.