Chainlink slipped below a critical support level this week, raising questions about whether the token can stabilize or continue its descent toward $8. The asset traded around $12 at press time following a 7% decline over the past 24 hours. Technical analysts now point to a breakdown from key resistance zones as sellers maintain control of the near-term trend.
What Happened: Support Break Opens Downside Risk
LINK lost its footing at the $15 level recently, a price point that marked the 0.618 Fibonacci retracement zone used to measure trend strength. The token has since fallen below the ascending channel that guided its price action from mid-2023, shifting momentum in favor of sellers.
Analyst Ali Martinez suggested LINK "could be retesting the breakdown zone before a move toward $8," noting that previous support is now acting as resistance.
Unless the price reclaims the $14 to $15 range, downside risk remains elevated, according to Martinez.
The next significant levels sit at $10 and $8, areas that align with historical price reactions. On shorter timeframes, LINK faced rejection at descending trendline resistance, triggering a sharp drop accompanied by increased volume.
Alpha Crypto Signal noted that "LINK failed to flip its trendline resistance... sellers are still in control of the trend." Technical indicators reinforce this bearish structure.
The 50-period exponential moving average and 200-period simple moving average both trend downward and remain above the current price, signaling that the broader setup has not yet shifted in buyers' favor.
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Why It Matters: Institutional Interest Clashes With Technical Weakness
The technical breakdown arrives as institutional developments unfold in the background. ETF analyst Nate Geraci reported that Grayscale is preparing to convert its private LINK trust into a spot exchange-traded fund, a move that could expand access to the asset for traditional investors. At the same time, analyst Javon Marks maintains a long-term target above $47, representing a potential gain of more than 240% from current levels.
However, on-chain data presents a more cautious picture. Large wallet addresses offloaded or redistributed over 31 million LINK in recent weeks, according to data shared by Martinez.
CryptoWZRD identified $13.50 as a level that needs to break for a more confident upside setup, adding that "a bullish reversal is needed to see a rally towards the $16 resistance." Both LINK and its Bitcoin pair show weak structure on daily and weekly timeframes, the analyst said.
Despite the technical pressure, Chainlink continues to rank among the most active blockchain projects in terms of development activity. The token is now approaching a support zone that has triggered bounces in the past, and traders are monitoring for any signs of stabilization that could set up a short-term recovery.
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