July 31, 2020
By Benson Toti
Chainlink’s LINK token dropped nearly 30% after hitting an all-time high asLEND/USD declined similarly after rallying 600% over three months
ChainLink is turning bullish as buyers eye up upside potential that could take the token’s price closer to its recently hit all-time high.
After a significant spike took the token to a high of $9 on July 5, ChainLink hit some stiff resistance that saw its price wither over two weeks. The value of the token against the US dollar sank to lows of $6.30 — nearly 30% down from its peak price.
The last few days have also seen sell-off pressure threaten to send prices lower; especially after Bitcoin’s spike above $10,000 saw most DeFi coins hit a downward correction.
As of writing, LINK/USD is seeing an upside of about 8% in intraday trades. A bull flag is formed on the daily chart to suggest the bulls have room to push prices higher going into the US and European trading sessions.
A flag pole pattern appeared after the token rose more than 90% in July, with the subsequent decline forming the flag within an ascending triangle. As such, LINK/USD is poised for a major upside that could see it revisit the area around its all-time high price at $9.00.
While Chainlink retains the bullish momentum that is likely to see it put together a massive rally, buyers need to prepare to battle through a tough supply wall around the $7.80-$7.95 area. Currently, about 84% of Chainlink holders are into the money having purchased the token below $7.80.
The price level is likely to be of critical interest to sellers, something that might be a barrier to the forecasted upside. On the downside, traders will watch out for support at $7.40 and $7.00, with a dip at these levels likely to see the token test prices near July lows around $6.30.
Another token looking to hit an uptrend is Aave. The DeFi protocol recently introduced Aavenomics, a staking proposal that sees holders of the LEND token earn rewards.
LEND/USD has surged 6% in the past 24 hours and over 23% since the release of the tokenomics proposal on July 28. The token spiked over 600% between April and Mid-July, following a surge in DeFi tokens.