Chainlink (LINK) is testing a critical support area on the weekly chart, with an analyst warning that a breakdown could shift the market’s tone decisively bearish. The $10–$11 region has emerged as a key level to watch after a head-and-shoulders structure formed over the past two years, according to an analysis posted on X by CryptoBullet (@CryptoBullet1). LINK traded near $11.98 at press time, up about 1.1% on the day but down 5.4% over the past week.
Weekly Head-and-Shoulders Near Neckline Support
The analyst’s weekly chart shows a standard head-and-shoulders pattern developing across 2024–2025: an initial rally forming the left shoulder, a higher peak establishing the head in early 2025, and a subsequent lower high creating the right shoulder later in 2025. The neckline support, which slopes slightly upward, currently aligns with the $10–$11 range.
Under classical technical analysis, this formation turns bearish on a confirmed breakdown below the neckline. For now, LINK remains above that zone, leaving the pattern unconfirmed.
Key Levels and Downside Scenarios
- Neckline support ($10–$11): Multiple pullbacks have respected this band while the pattern formed. A decisive weekly close below it would validate the bearish setup, per the analysis.
- Measured move target ($4–$5): If the head-and-shoulders breakdown confirms, the traditional projection—based on the height from head to neckline—implies potential downside into the $4–$5 area. The analyst framed this as an extreme scenario contingent on strong selling pressure.
- Intermediate support (~$7.15): A more conservative downside area aligns with the Point of Control on the Visible Range Volume Profile and overlaps with the 2022–2023 accumulation zone, which could act as a stopping point.
Market Context
Chainlink is a decentralized oracle network that connects smart contracts to off-chain data and systems, making it a key component for DeFi and other blockchain applications. A sustained hold above the $10–$11 neckline would keep the head-and-shoulders pattern unconfirmed and could set up a short-term relief bounce, according to the analysis. Conversely, a weekly close below that band would increase the risk of a trend shift toward the cited downside targets.