January 17, 2022

Chainlink (LINK) Becomes The ‘Tesla’ Of Cryptocurrencies – What’s Next?

As the price of Bitcoin (BTC) continues to trade in a tight range, the altcoin market has been pushing higher every week, with the most recent surge coming from Chainlink (LINK).

After breaking above the $ 5 level, LINK price surged almost 100% in a matter of days and ended up making a new all-time high at $ 8.40. Through this massive momentum, LINK above from EOS (EOS) and Crypto.com (CRO) to claim a spot among the top ten cryptocurrencies listed on CoinMarketCap.

Investors are now curious to see if Tezos (XTZ) will continue to follow LINK and there are expectations that other altcoins will also follow LINK’s upward trajectory.

Daily performance of the cryptocurrency market. Fountain: Coin360

What drove the LINK price to $ 8.50?

LINK has proven to be one of the strongest engines in the cryptocurrency markets in recent years. This was proved once again when the cryptocurrency broke above the previous all-time high of $ 5 and surged 85% towards $ 8.50.

LINK / USDT 1-day chart. Fountain: TradingView

At previous article, a USD 7.00 – USD 7.25 target using the Fibonacci extension tool. However, LINK exceeded that goal by one mile.

As the chart shows, the rally could be temporarily over, as sellers are intervening, but this will only be confirmed if the daily candle closes as shown in the chart above. Currently, the candle shows a giant wick to the upside, which indicates that there is more pressure to sell than to buy.

Apart from the candle, Such a giant move is due to a corrective move, so it’s good to check the levels for potential support.

LINK / USDT 1-day chart. Source: TradingView

LINK / USDT 1-day chart. Fountain: TradingView

The 1-day chart shows clear support levels. One of them is between USD 6- USD 6.50. Previous resistance in USD 6.57 it can be confirmed as support, which would suit a renewed test of the $ 8.50 resistance level.

But nevertheless, a clearer signal would be a corrective move towards the $ 5 level as it used to be a significant resistance zone before the massive breakout occurred.

LINK / USDT 4-hour chart. Source: TradingView

LINK / USDT 4-hour chart. Fountain: TradingView

The 4-hours chart shows a bright support / resistance change from the $ 5.70 level, prompting the continuation and the price accelerated towards $ 8.50.

The most likely scenario is a test of the previous high of support. In this case, the level of USD 6.50- USD 6.60. A potential wick towards the $ 6.20 level is one area to watch out for.

If this zone holds, a renewed test of the highs at $ 8.50 is likely to occur. If the $ 6.50 level is lost, more downward pressure is likely to be seen in markets with a possible retest of the $ 5 level.

Breakout in the LINK / BTC pair

LINK / BTC 1-day chart. Source: TradingView

LINK / BTC 1-day chart. Fountain: TradingView

The LINK / BTC pair is also showing a massive breakout. The hardiness zone in 0.00055000 sats was tested multiple times before the breakout occurred.

This price action is actually quite similar to Bitcoin’s resistance zone at $ 10,000- $ 10,500.. As the saying goes, the more often a resistance is tested, the weaker it becomes.

In the case of Bitcoin, the resistance zone at $ 10,000- $ 10,500 has been a difficult area to overcome for a year now and for LINK the sats barrier of 0.00055000 has been a resistance zone for seven months.

As the resistance zone breakthrough, there was a massive acceleration, but the chart shows signs of overstretching to the upside. For this reason, a corrective move is likely to occur.

Then, Potential levels of interest should be the previous resistance at 0.00055000 sats and the area between 0.00065000 – 0.00066500 sats.

When Chainlink moves, Tezos follows

XTZ / USDT 1-day chart. Source: TradingView

XTZ / USDT 1-day chart. Fountain: TradingView

Once Chainlink moves, Tezos tends to follow him. However, in the previous months, Tezos has been lagging, but the price finally made a strong move during the weekend.

The XTZ / USDT pair has been showing strength in the past days and is currently facing the final hurdle before a new all-time high.

The pair secured support at the $ 2.40 level before continuation and acceleration to $ 3 occurred. The next step to watch out for is a test of the $ 2.70- $ 2.77 support level.

If that level maintains support, XTZ / USDT is likely to break the $ 3 barrier and test the all-time high.

The $ 3 resistance area has been tested three times and it is possible that another test of the resistance zone will see the price finally break out of it.

If XTZ / USDT breaks above $ 3, we are supposed to start accelerating and get a Chainlink-like move. And that similar move means a new all-time high.

XTZ / BTC pair breaks above 100-day moving average

Chart of the XTZ / BTC pair for 1 day. Source: TradingView

Chart of the XTZ / BTC pair for 1 day. Fountain: TradingView

The XTZ / BTC pair is also showing strength as it recently broke above the 100-day MA. This is also the case for the XTZ / USDT pair. If the area of ​​resistance before 0.00002900 – 0.00002950 sats continues to hold for support, a support / resistance turn will be achieved.

Once this support / resistance change is confirmed, it is likely to continue to the upside and traders will set their targets around the all-time high around 0.00003700 – 0.00003800 sats.

If Tezos manages to break above all-time high levels, the sky is the limit and astute traders can look at the Fibonacci spreads to determine new targets.

The views and opinions expressed here are solely those of the Author and do not necessarily reflect the views of Cointelegraph. Every investment and trade movement involves risk, you must carry out your own research when making a decision.

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Chainlink (LINK) Becomes The ‘Tesla’ Of Cryptocurrencies – What’s Next?