Veteran crypto trader Ali provided an update on Chainlink’s ($LINK) price action this week, noting signs of a bullish pennant pattern developing on its chart:
On the daily timeframe, Chainlink can be seen trading within a clearly defined pennant structure over the past couple weeks. This features gradual converging trendlines connecting the series of higher lows and lower highs.
A decisive breakout above the top trendline, which currently aligns with resistance around $17.20, could confirm the bull pennant. Measuring the size of the previous move into this pattern projects a potential breakout target around $34.
However, pennants can also resolve bearishly with breakdowns below support. For LINK, invalidation of the current bullish outlook would likely come with a drop back below $14.20 – the origin of the recent advance.
In summary, Chainlink appears to be consolidating within a textbook bull pennant formation, according to technical analyst Ali. An upside resolution could see significant upside continuation towards $34, but continued trading within the pattern or breakdowns below $14.20 would negate that bullish potential. Traders can plan entries and stop losses accordingly based on these technical levels.
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