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LINK’s price could rally on speculations over Chainlink’s oracle services growth coupled with a supportive technical pattern.
Chainlink (LINK) looks poised for a 25% price rally in the days leading up to its staking protocol launch, based on several fundamental and technical factors.
Chainlink’s price rallies ahead of staking launch
The staking feature, which will go live as v0.1 in beta mode on Dec. 6, comes as a part of the so-called “Chainlink Economics 2.0” that focuses on boosting LINK holders’ reward-earning opportunities for “helping increase the crypto economic security” of Chainlink’s oracle services.
Earlier, Chainlink users had to launch their own nodes to receive rewards in LINK tokens. The staking feature effectively opens new avenues for them to earn LINK rewards that could, in theory, boost demand for the token.
Additionally, demand for LINK’s parent platform, Chainlink, as an oracle service provider, should also increase.
David Gokhshtein, founder of blockchain-focused media company Gokhshtein Media, believes it could happen in the wake of the recent FTX collapse.
The analyst highlighted how traders have been seeking more clarity on exchanges’ reserves after the FTX fiasco, which can boost demand for oracle services like Chainlink and, in turn, push LINK’s price higher.
$LINK is definitely being overlooked. With everything that’s happened and with the new “Proof of Reserves” being pushed out there, ChainLink will be used to push that data out there.
— David Gokhshtein (@davidgokhshtein) November 26, 2022
Chainlink Labs launched its proof-of-reserve auditing services to exchanges in November 2020.
The speculations have helped LINK’s price rally in recent days. Notably, Chainlink’s price gained 35.50% eight days after bottoming out locally at around $5.50 — trading for as much as $7.50 on Nov. 29, its highest level in two weeks.
The LINK/USD pair now eyes further upside in the near term, price technicals suggest.
A failed LINK price breakdown
LINK reclaimed its multi-week rising support trendline on Nov. 29, three weeks after losing it in the wake of the FTX-led market sell-off.
In doing so, the Chainlink token also invalidated its prevailing ascending triangle breakdown setup toward $4.
It now trades inside the pattern’s range, eyeing a rally toward the upper trendline near $9.40, up 25% from the current price levels, by the second week of December, as shown below.
LINK/USD three-day price chart. Source: TradingView
Michaël van de Poppe, market analyst and founder of Eight Global, also anticipates LINK to hit or cross above $9
#Chainlink showing a ton of strength, also expecting continuation there to happen.
If I didn't have a long yet (but I do), then I'd be targeting for something like this in which I'd be looking at $9 area for a TP. pic.twitter.com/rRdv4eL91H— Michaël van de Poppe (@CryptoMichNL) November 29, 2022
Moreover, a bullish continuation move above the $9.40 resistance could have LINK eye $16 next, the ascending triangle breakout target.
Related: Binance publishes official Merkle Tree-based proof of reserves
Conversely, slipping below the triangle’s lower trendline again risks bringing the breakdown setup toward $4 back in play, down about 45% from current prices.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.