An analyst has pointed out how Chainlink could see a major bullish breakout if its price can break past the resistance barrier of this technical analysis (TA) channel.
Triangles can be classified into different types depending on how the trendlines are oriented. The upper line being parallel to the time-axis results in what’s known as an “Ascending Triangle.” Similarly, the lower level being parallel forms a “Descending Triangle.”
The Triangle that Chainlink has been following for the last few years doesn’t cleanly fit into any of these classes. Instead, its channel lies somewhere between an Ascending Triangle and a Symmetrical Triangle, as the chart shared by Martinez shows.
As is visible in the above graph, the 1-day price of Chainlink retested the upper level of the Triangle earlier in the year and found rejection. The coin has since been on the way down.
The chart also shows that LINK is slowly approaching the end of this multi-year channel. Generally, breakouts become more likely the smaller an asset’s range gets. As the coin is clearly trading inside a narrow region now, a breakout could be coming closer.
A surge above a Triangle is usually a bullish sign, while a decline under the channel can lead to bearish action. As such, the next retest from Chainlink could be worth keeping an eye on, as a breakout could set the tone for the coin’s upcoming price action.
It only remains to be seen, however, whether LINK would next retest the upper level or the lower one. In the scenario that the coin can break past the resistance line situated around $25, the analyst thinks its price could see a bull rally.
At the time of writing, Chainlink is floating around $18, down over 2% in the last seven days.
