Current Ideas/Analysis.
ChainLink (LINK/USD)
Synopsis:
Market Cap: $5.9 Billion.
Circulating Supply: 350 Million LINK.
Max Supply: 1 Billion LINK
Decentralized oracle network. As per the Chainlink whitepaper, Chainlink’s aim is to bridge on-chain and off-chain environments. They aim to make smart contracts “externally aware” thus allowing them to access off-chain data securely. As it stands, blockchains are unable to independently access data outside of their network, but require data from sources outside of said network to accurately execute smart contracts. Currently an “oracle” is required to accomplish this. By implementing a decentralized oracle network, Chainlink aims to create a market based system for accessing this external data, theoretically improving the quality and lending additional confidence to the accuracy of the data required for respective smart contracts.
Technical Look:
· Prices have been in an uptrend since April of 2020, following a 46% decline on March 12, 2020.
· 10 period EMA crossed the 100D EMA have since increased to current levels above $19.
· Momentum (using the 10 period RSI as a proxy) is confirming recent price action.
· Conventional wisdom would imply that the RSI level is indicating overbought conditions, though I'm inclined to use RSI as a tool for locating divergences.
· As such, I would not be inclined to exit long positions of LINK based on the RSI level.
· The 2 most recent candles indicate uncertainty in my view, given the narrow trading range. Particularly when juxtaposed with the recent expansion in Average True Range (currently sitting at 1.741).
· Prices reaching the upper level of its Bollinger bands indicates that a reversion to the mean could be in order
Disclaimer: The information provided on this site is opinion, intended for informational purposes only, and does not constitute investment advice.