The price of Chainlink has been rising in recent weeks, after reaching lows below $10 in April and highs above $26. The price has developed a rounded cup shape, with the neckline near the demand zone of $26 to $30.
Despite the correction to $23.94, the overall structure remains bullish, with the price above the 50-day exponential moving average (EMA) at $18.87. If the price consolidates at this level, it could be forming a classic cup and handle pattern before attempting to break the resistance.
It is worth noting that the demand zone was a critical rejection point in 2023 and could influence the direction again. However, overall, the bullish formation enhances the long-term outlook for the price of Chainlink.
The ADX value of 35.57 indicates strong directional conviction, confirming the solid trend. In the case of a slight correction, the support at 20, which was previously resistance, could be a good retest point. The support structure here is prominent, as LINK has been consistently forming higher lows since June.
Despite the rejection at the short-term level of $26, LINK has been strong enough to hold below previous swing levels. And although rejection is a possibility at the resistance, a clear breakout above $30 would create room for new annual highs, especially considering that LINK projects a long-term target of $52.