A widely followed crypto analyst is saying that one Ethereum-based (ETH) altcoin is dangerously close to flipping bearish.
Pseudonymous crypto strategist Rekt Capital tells his 385,900 followers on the social media platform X that decentralized oracle provider Chainlink (LINK) has to hold a key support level of around $13.57 to remain in an uptrend.
“Chainlink has confirmed the breakout on the daily timeframe but is trying to retest the red box bottom. Make-or-break moment as a failed retest here will set the one-week up for bearish bias where the red box flips from old support to new resistance.”
LINK is trading for $13.53 at time of writing, down slightly in the last 24 hours.
Looking at Bitcoin, the trader says that based on historical price patterns, BTC could see a retracement of up to 40% ahead of its scheduled April halving event, when miners’ rewards are cut in half.
“It’s possible Bitcoin could drop up to 40% around its halving event. We’ve seen that in the past before. So right now we have to focus on these few phases. [There] is now a 42-day period that we have left before the pre-halving rally. A pre-halving rally tends to occur after a retracement in Bitcoin’s price action and then we see a lot of upside. A few weeks around the halving event itself we tend to see a pre-halving retrace and you can see that if we are to see history repeat a minus 40% pre-halving retrace could occur in the future.
In 2020, we saw a pre-halving retrace of 20%. And you can argue that this retrace was only 20% because we saw a major crash in the pre-halving period. So if we get a deep retrace over these next 40 days, does that then mean that we’ll have a shallower retrace around the halving event itself? And if we see a shallow retrace, does that mean we’ll have a deeper retrace in the pre-halving retrace period?”
Bitcoin is trading for $46,804 at time of writing, up nearly 4% in the last 24 hours.
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Source: https://dailyhodl.com/2024/01/09/chainlink-facing-make-or-break-moment-as-link-nears-bearish-setup-according-to-crypto-trader/