• LINK/USD has been in a long-term consolidation following an abrupt selloff.
• A bearish flag might form and bulls and bears should wait for a breakout before acting.
• 2023 brought a much-needed rally to the cryptocurrency market, but every bounce was not strong enough to break the previous lower high.
LINK/USD is in a long-term consolidation following an abrupt selloff. Unlike other cryptocurrencies, LINK did not make new lower lows in the second half of 2022. Every bounce was not strong enough to break the previous lower high, signaling that bears appear to still be in control.
2023 brought a much-needed rally to the cryptocurrency market, with Bitcoin surging and its bullish price action translating into bullish movements on other coins too. The resulting price action evolved inside a horizontal channel, and until a breakout occurs, the chances are that it will go nowhere, frustrating both bulls and bears alike.
Bearish Flag Pattern?
Whenever a horizontal consolidation appears on a chart, technical traders should look on the left side for trending conditions. In this case, a bearish trend is present, meaning that the horizontal consolidation might be part of a bearish flag pattern. For this scenario not to occur, bulls should wait for the price to break above $9.5 before going long.
The measured move of any horizontal channel is its width; so look for a breakout in either direction and target its measured move accordingly.