1-YEAR PRICE GOAL FOR CHAINLINK and a POTENTIAL PULLBACK TO $7
Hello everyone!
I have been busy for awhile and wasn't able to make much technical analysis, but here I am!
I have recently seen @Tradingshots logarithmic Fibonacci analysis on Bitcoin (www.tradingview.com/...e-a-first-top-ahead/) and his price target for the end of this cycle. I tried a similar approach here with Chainlink/USDT pair. I made my analysis on the weekly. Because patterns are the most clear to me on the weekly chart. I have to warn you that the number of data points we have for LINK on the weekly chart is very little. In any statistical test, the minimum sample size should be at least 10 and we have 2 here. But this is what we have. However, there are still other things which provides support to the analysis other than the logarithmic Fibonacci tool.
Let's start with the logarithmic Fibonacci levels. The first thing I realized is the bubble tops overlapping with x.786 levels for the last two cycles. The price pulled back to 1.0 Fibonacci level after the Jun 19 top and to around 2.13 Fibonacci level after the Aug 20 top. So, the pullback levels are not as consistent as the tops. HOWEVER, the percentages of pullbacks are very close to each other: approximately 67% and 63%, respectively. So, I think we have something here. Moreover, pay attention to the dates of the tops. Both tops happen in the 3rd quarter. Jun and Aug. Unfortunately, we only have two data points. So, we can't do more logarithmic Fibonacci analysis.
Luckily, there are clear TRIANGLE patterns before both breakouts. First thing I want you to pay attention is the time range of the triangle patterns formed by trend lines passing through the highs and lows of the price swings. Each triangle formed is 46-week long. It is true that price didn't stay in this range for 46 weeks, but it hardly does in triangle patterns. On the other hand, remember that pullback percentages are very close (67% and 63%) in the triangle top and bottoms. The second similarity is that price touches the bottom trend line of both triangles twice before it breaks out of the triangle. However, the length of swings in terms of time are different. First the price breaks out of the triangle took 31 weeks, but it took 21 weeks for price to break out of the triangle this time. Interestingly, however, both breakouts happened in JANUARY which brings us to MARCH 20 DIP.
After the price breaks out of the first triangle, it makes a fake out and then dips significantly, from around $5 to $1.36, approximately 73% pullback. Right now, we are around those levels where the price broke down the last time and this makes me really really nervous. Considering the oversold USD and the crazy run since AUGUST in EQUITY and CRYPTO markets, I think we have enough reasons to be anxious. Stock market has started to price in a pullback. If you look at sub-sectors, UTILITIES started to perform better against other sectors again. So, I recommend everyone in LINK to watch these price levels very carefully. If we can't quickly go to $26 levels, I will take this as a sign of a potential pullback. Before talking about my price target, I want to point out the RSI level at tops and before the March 20 DIP. RSI peaked around 93 and 92 in the last two peaks, respectively. RSI also went over 70, 77.22 exactly, during the JAN 20 fake out. NOW, we are above 70 again. I am not suggesting watching 77 level on the RSI, but if RSI starts to turn its head down around these levels, it might be another sign for a short-term major price pullback.
Let's talk about the price target. The last two times, price hit the x.786 logarithmic Fibonacci levels. I expect the price to behave similarly this time, too. My price target is the $80! There are 59 weeks between the last two ALL TIME HIGH (ATH). We can simply expect the next peak after 59 weeks from the last ATH which correspond to SEP 21. Alternatively, we can expect the next ATH in AUG 21 from the point of view that both triangle breakouts happened in JANUARY and ATHs will coincide the same month, which is AUGUST. Also remember that the last ATHs happened in the third quarter, JUN and AUG. The last alternative is expecting a 30% shortening of the cycle by looking at the time the price stayed in the triangles. 21 weeks this time and 31 weeks the last time. If this scenario plays our, the next ATH will be 43 weeks after the last ATH which correspond to JUN 21. If we see a pullback in the price as in the last cycle, we can have a better idea which scenario is more likely after the price recovers back to today's level.
In conclusion, there seems to be a pattern in the CHAINLINK/USDT price pair. Last two ATHs hit x.786 logarithmic Fibonacci levels and the next one is around $80. This is my price target. Pullbacks after ATHs are around the same amount, 67% and 63% respectively. The triangle patterns formed after ATHs also support the idea that the LINK price follows some type of pattern. If this is true, we might have a major pullback in price like the last time. Therefore, $22 levels should be watched very carefully. If the price stay around these levels for too long, it might be a sign of a pullback coming which has started to price in in EQUITY markets. However, if the price hits $26 levels quickly, I will worry less about a pullback. The reason I am pointing out this possibility strongly is that the amount of profit you can make by entering LINK around these levels versus entering LINK around $7-8 levels is A LOT. 1000% to 400%. You decide.
I guess this is it! Let me know what you think.
Have a great weekend!
I have been busy for awhile and wasn't able to make much technical analysis, but here I am!
I have recently seen @Tradingshots logarithmic Fibonacci analysis on Bitcoin (www.tradingview.com/...e-a-first-top-ahead/) and his price target for the end of this cycle. I tried a similar approach here with Chainlink/USDT pair. I made my analysis on the weekly. Because patterns are the most clear to me on the weekly chart. I have to warn you that the number of data points we have for LINK on the weekly chart is very little. In any statistical test, the minimum sample size should be at least 10 and we have 2 here. But this is what we have. However, there are still other things which provides support to the analysis other than the logarithmic Fibonacci tool.
Let's start with the logarithmic Fibonacci levels. The first thing I realized is the bubble tops overlapping with x.786 levels for the last two cycles. The price pulled back to 1.0 Fibonacci level after the Jun 19 top and to around 2.13 Fibonacci level after the Aug 20 top. So, the pullback levels are not as consistent as the tops. HOWEVER, the percentages of pullbacks are very close to each other: approximately 67% and 63%, respectively. So, I think we have something here. Moreover, pay attention to the dates of the tops. Both tops happen in the 3rd quarter. Jun and Aug. Unfortunately, we only have two data points. So, we can't do more logarithmic Fibonacci analysis.
Luckily, there are clear TRIANGLE patterns before both breakouts. First thing I want you to pay attention is the time range of the triangle patterns formed by trend lines passing through the highs and lows of the price swings. Each triangle formed is 46-week long. It is true that price didn't stay in this range for 46 weeks, but it hardly does in triangle patterns. On the other hand, remember that pullback percentages are very close (67% and 63%) in the triangle top and bottoms. The second similarity is that price touches the bottom trend line of both triangles twice before it breaks out of the triangle. However, the length of swings in terms of time are different. First the price breaks out of the triangle took 31 weeks, but it took 21 weeks for price to break out of the triangle this time. Interestingly, however, both breakouts happened in JANUARY which brings us to MARCH 20 DIP.
After the price breaks out of the first triangle, it makes a fake out and then dips significantly, from around $5 to $1.36, approximately 73% pullback. Right now, we are around those levels where the price broke down the last time and this makes me really really nervous. Considering the oversold USD and the crazy run since AUGUST in EQUITY and CRYPTO markets, I think we have enough reasons to be anxious. Stock market has started to price in a pullback. If you look at sub-sectors, UTILITIES started to perform better against other sectors again. So, I recommend everyone in LINK to watch these price levels very carefully. If we can't quickly go to $26 levels, I will take this as a sign of a potential pullback. Before talking about my price target, I want to point out the RSI level at tops and before the March 20 DIP. RSI peaked around 93 and 92 in the last two peaks, respectively. RSI also went over 70, 77.22 exactly, during the JAN 20 fake out. NOW, we are above 70 again. I am not suggesting watching 77 level on the RSI, but if RSI starts to turn its head down around these levels, it might be another sign for a short-term major price pullback.
Let's talk about the price target. The last two times, price hit the x.786 logarithmic Fibonacci levels. I expect the price to behave similarly this time, too. My price target is the $80! There are 59 weeks between the last two ALL TIME HIGH (ATH). We can simply expect the next peak after 59 weeks from the last ATH which correspond to SEP 21. Alternatively, we can expect the next ATH in AUG 21 from the point of view that both triangle breakouts happened in JANUARY and ATHs will coincide the same month, which is AUGUST. Also remember that the last ATHs happened in the third quarter, JUN and AUG. The last alternative is expecting a 30% shortening of the cycle by looking at the time the price stayed in the triangles. 21 weeks this time and 31 weeks the last time. If this scenario plays our, the next ATH will be 43 weeks after the last ATH which correspond to JUN 21. If we see a pullback in the price as in the last cycle, we can have a better idea which scenario is more likely after the price recovers back to today's level.
In conclusion, there seems to be a pattern in the CHAINLINK/USDT price pair. Last two ATHs hit x.786 logarithmic Fibonacci levels and the next one is around $80. This is my price target. Pullbacks after ATHs are around the same amount, 67% and 63% respectively. The triangle patterns formed after ATHs also support the idea that the LINK price follows some type of pattern. If this is true, we might have a major pullback in price like the last time. Therefore, $22 levels should be watched very carefully. If the price stay around these levels for too long, it might be a sign of a pullback coming which has started to price in in EQUITY markets. However, if the price hits $26 levels quickly, I will worry less about a pullback. The reason I am pointing out this possibility strongly is that the amount of profit you can make by entering LINK around these levels versus entering LINK around $7-8 levels is A LOT. 1000% to 400%. You decide.
I guess this is it! Let me know what you think.
Have a great weekend!
Comment:
Hey all! As I mentioned earlier, LINK is having a hard time to break above the $22-23 levels. More worrying is that it is currently forming a HEAD-AND-SHOULDERS pattern in the HOURLY chart. If LINK breaks below $19, I am expecting $14-15 levels as the next price target.
Comment:
Another warning signal is that RSI curled down around 78 level. The price action so far is almost identical with the previous cycle. So be very very careful!
Comment:
Hey all! I wanted to put an update for those who are watching the idea. So far, we haven`t break above $26. This doesn't look good. If you are following the economy in general, risk-off mentality is taking over bullishness. I believe that we are on the verge of a major $$$ spike and pullback in all markets. I`ll save my chips and shop at discounted prices.
Comment:
Okay. Here is the current situation. Chainlink is forming an ascending triangle in the 4h chart and this is the major difference between the previous cycle and the current cycle. In the previous cycle, LINK created a double top after breaking the symmetrical triangle in the daily and broke down sold around 60%. However, this time, LINK is more bullish because it is forming an ascending triangle pattern in 4h chart after breaking the symmetrical triangle pattern on the daily. Now, the signal I am waiting for is a close above $25.35 in the 4h chart. If this happens, the first level I am eyeing is the $31 and we will not see $25 levels again for a long time possibly.