Over the past several months, now, Chainlink has seen a momentous rally. As of the time of writing, Chainlink has been valued at $15.81. This stands as an 11% increase since the leading Defi’s token’s value seven days prior. It should be noted, however, that the coin’s all-time high was recorded at $20, which is about 21% lower than what it is currently trading for now. Even so, there is a considerable amount of bullish market pressure for the leading DeFi coin.
Sell Signal Looming
LINK, however, may be subject to a very powerful reversal, as can be seen in the latest market data from CoinGecko. This comes by way of a very significant indicator.
The Tom Demark Sequential has recently formed a “sell 9” within the monthly chart of the LINK cryptocurrency. The indicator usually prints out “9” and “13” candles when the asset stands at an inflection point within its trend. With this signal, downside movement was predicted, with the coin itself seeing a sizable drop, as is.
Bitcoin Might Affect LINK
This is noteworthy, however, as it stands as the first-ever Tom Demark Sequential within Chainlink’s monthly chart. What this means, is that there isn’t really much of a precedent to fall back to, historically speaking, like there usually is when one looks at Ethereum’s weekly chart.
As always, it could be Bitcoin that has the final say when it comes to the movement of altcoins, overall.
Analysts have already pointed out how altcoins begin to underperform when the world’s original cryptocurrency starts to rally. This is due to most investors focusing their attention and capital on to this leading cryptocurrency.
Everything Focuses On BTC
Mohit Sorout stands as a founding partner of Bitazu Capital, and gave comment about this statement at large. Sprout explained that the cycles of most altcoins are focused primarily around the volatility of Bitcoin itself. Once Bitcoin’s volatility dries up, investors refrain from trading in Bitcoin, which shows in its volume, as well. This, Sorout states typically leads to a large uptick in altcoin speculation, which then drives the prices up. Typically speaking, Sorout pointed out that altcoins holding a large scale of memetic behavior and strong narratives get the most volume, in the end.
Without significant amounts of buying demand, a Bitcoin spiking in volatility typically leads to altcoins suffering stunted rallies, in turn.