Chainlink had been our bullish cryptocurrency where we tried to go long from support levels, ultimately missing out our entry points. As the overall market trend of cryptocurrency is bearish, Chainlink won't be left behing to follow the train suit. It has the potential to drop from this current resistance of 7.6 all the way down towards the $5. The market has formed lower lows and lower highs in order to stable the trend of the bearish move. We will be shorting the market at the current resistance level. The breakout of the resistance can only be confirmed if the resistance is validated for the breakout. Otherwise, we will consider this a fakeout.

The market is in a bearish channel with the prices rejecting the upper trendline band. If the market breaks the lower trendline inducing the breakout sell, we will have a further confirmation for the short side. 

The retracement area which is in confluence with the resistance level is the 61.8% level. This level will act as the catalyst to drop the market down below the support level which was a resistance earlier.

The EMA 50 is super bearish with the curve slanting in linear shape towards the downside. The analysis of EMA 50 being retest might not happen in this given position of the market. Therefore, we will miss this EMA 50 factor to technically evaluate the setup, other than, it is still bearish.

RSI is in a bullish region with the level being 57. Once it drops below the neutralized level of 50, we will have another confirmation for the market towards the bearish side and the market having a window towards the oversold region.

Looking to short Chainlink

Aug 06 2022