- A widely followed crypto strategist is warning that Chainlink (LINK) may be on the verge of a massive correction.
- Pseudonymous analyst Credible tells his 394,500 followers on the social media platform X that the native asset of the leading decentralized oracle network appears to have printed a mid-cycle top.
- “I understand that after 10 months of up only and a 4x rally, a pullback lasting 2-3 months with a 50-60% drawdown is normal, natural and healthy,” Credible explains.
Explore the potential implications of a major correction in Chainlink (LINK) and its impact on the broader crypto market.
Chainlink’s Rally and Potential Correction
According to the analyst, a deep corrective move is now in the cards for LINK after witnessing massive rallies in the last few months. The trader uses the Elliott Wave theory, which states that a bullish asset tends to witness a five-wave rise before pulling back. Looking at the trader’s chart, he seems to suggest that LINK has completed its five-wave rally and is now poised for a correction toward support at $7.26. At the time of writing, LINK is worth $16.49.
Technical Analysis and Market Sentiment
The possibility of a 50-60% drawdown in LINK’s price is a scenario that could influence investor sentiment across the crypto market. Such a significant correction could trigger a reassessment of risk among crypto investors, potentially leading to increased volatility in other altcoins and even affecting the major players like Bitcoin and Ethereum.
Impact on Related Cryptocurrencies
Credible is also bearish on Ethereum (ETH) scaling solution Polygon (MATIC), predicting that the altcoin will fall to support at $0.585. “Hello MATIC my old friend, it’s time to short you once again. Up to 5-8% more potential upside, looking for 20% downside at minimum,” he stated. At the time of writing, MATIC is worth $0.706.
Conclusion
This analysis highlights the importance of market cycles and technical indicators in predicting price movements. Investors should consider these factors when making investment decisions in the volatile crypto market. As always, due diligence and a careful assessment of market conditions and individual risk tolerance are crucial.
