Chainlink Could Decline in Value Following the Sell Signal

Chainlink has been on the rise since mid-October, which made its value feature the highest peak in over a year. This altcoin featured a value of between $6 and $7 in the past several months. But, in the past few weeks, it managed to get up to $15.

However, it seems like the rise in its trading price is coming to an end. This comes after a statement on X by a crypto analyst named Ali. He noted that Chainlink is being bound for a correction.

Ali mentioned that the TD Sequential has presented a sell signal on their daily, 3-day, and weekly charts. According to him, this is something that could lead to a retracement to this level.

Chainlink Might Decline to $12.50

As Ali explained on X, Chainlink could suffer a correction based on what the TD Sequential signals are indicating. In case you didn’t know, the Tom Denmark (TD) Sequential is a well-known indicator in technical analysis that finds its use in pointing out reversals in the value of any asset.

The metric from the TD Sequential gives out signals whenever an asset has seen nine candles following a reversal in its value. As a result, it will feature green candles if the signal shows sell one. On the other hand, the candles will be red if the single is buy one.

This is a phase known as the Setup Phase. Once the setup is complete, a countdown that features 13 candles begins to unfold. At the end of the featured candles, the value could indicate hitting another probable bottom or top. It depends on whether the phase begins with a buy or sell signal.

As noted earlier, Chainlink(LINK) enjoyed rapid growth in recent weeks. This led the asset’s price to reach heights that weren’t seen since April 2022. Yet, this amazing run may come across a temporary setback, according to Ali.

It seems like the TD Sequential setup phase has recently finished for Chainlink. The featured signals didn’t only appear on just one but on three of the crypto coin’s charts. The featured charts reveal the daily, 3-day, and weekly predictions.

All three charts finished with green candles, meaning that a reversal towards the bearish side may be inevitable for Chainlink. Ali projects that the coin’s retracement would get to the $12.50 level. This is a decrease in value of more than 18% from the current trading price of the asset.

He also added that if the cryptocurrency fails to hold above this critical support area, then it could go as low as $10.50. A decline such as this would decrease Chainlink’s value by over 31%.

However, even if such sudden drops happen, this coin wouldn’t have gully undone its recovery since mid-October. It shows us how sharp chainlink’s bullish momentum truly is in recent weeks.

All we can do now is wait to see what trajectory Chainlink takes from here after these challenging signals. At the moment, it seems like the chances are not on its side.