Chainlink price forms bulish divergence as exchange outflows rise

Chainlink price could be on the verge of a bullish breakout after testing a crucial resistance, forming a bullish divergence, and as its exchange outflows rise.

Chainlink (LINK) was trading at a crucial resistance point at $12.60 on Friday, up from this month’s low of $10.15. 

A potential catalyst for LINK is that its exchange outflows have continued rising as investors move their tokens to self-custody. Nansen data shows that Chainlink tokens on exchanges dropped by 1.1% in the last seven days to 260 million, compared to 263 million tokens the same day last week. 

Most of the Chainlink tokens are held on exchanges like Binance, Coinbase, Upbit, Kraken, and Robinhood. 

Chainlink is seen as one of the top utility tokens in the crypto industry. It is the largest oracle network in the space, with the total value secured rising to $30 billion. Some of the biggest players in the ecosystem include AAVE, Spark, Compound, Venus, and Usual. 

Chainlink price technical analysis

The daily chart shows that LINK has been in a strong downtrend over the past few months. It dropped from a high of $30.80 in November to a low of $10.15 this month, its lowest level since November last year.

Chainlink has retested a key resistance level that it has struggled to break above since February 13. It has also formed a falling wedge-like pattern, a common bullish reversal signal in technical analysis.

Additionally, LINK has formed a bullish divergence pattern. The MACD indicator, which tracks momentum and trend strength, has continued rising, with its two lines nearing the zero level. 

The Relative Strength Indexand the Awesome Oscillator have also continued trending higher. Therefore, the coin is likely to stage a bullish breakout, with bulls targeting the psychological level of $15, approximately 15% above the current price.