LINK Recognize Head and Shoulders Pattern - Will 2026 Put a Dot on the Uptrend?

After nearly 800 days of formation, Chainlink is gradually revealing a classic bearish pattern that experienced traders often monitor. The head and shoulders pattern on the weekly chart of LINK is now quite clear, with the neckline around $13 – a very critical price level for determining the token’s next trend. According to the latest data, LINK is trading at $13.18, down 0.17% in the past 24 hours.

From Bottom to Top - And Warning Signs

Chainlink has experienced an impressive recovery phase since September 2023. At that time, the token broke out of a prolonged downtrend, with single-digit prices starting to “disappear” with notable strength. The rally pushed LINK to a cycle high of $30.94 in December 2024 – nearly a 440% increase from the previous low.

However, the upward momentum did not last. After reaching the peak, the price started to decline, and more importantly, it formed a lower high in August – a classic warning for those who know how to read market signals. From a long-term perspective, the entire price movement over the past two years almost perfectly illustrates the head and shoulders pattern.

The Crucial Role of the $13 Level

The $13 level is not a random number. It is the neckline of the head and shoulders pattern – the boundary between sustained valuation and technical collapse. If LINK closes the week below this level, the pattern will be confirmed as broken, and the likelihood of the price continuing to “plunge” will increase significantly.

What makes the situation more concerning is that momentum indicators have clearly shifted to negative signals. RSI has fallen below 50, MACD is in the negative zone, and both continue to head downward – a rare combination that often confirms selling pressure is not just random volatility but a real driving force.

Short-Term Pressure

Expanding to a shorter timeframe offers no positive signals. On the 2-hour chart, LINK is within a narrowing triangle pattern – another bearish structure. The current price is competing with the resistance at $13.50 and has not yet broken through the upper diagonal trendline. These compression cycles often end with strong volatility.

As long as LINK stays above $13.50, there is room for a short-term rebound. However, if it “breaks” this level, sellers may launch a more aggressive attack.

Technical Forecast – If the Pattern Completes

According to technical analysis, if this head and shoulders pattern completes its full height, the price of LINK could reach the $5 USD region. This would be lower than the previous bear market bottom, which is why this pattern has attracted attention from professional traders.

Current Decision Point

Chainlink is at a crossroads. A major bearish pattern is nearing completion, momentum indicators are weakening, and the price is tightly compressed – all these factors are converging at the same time. 2026 could be the year when LINK’s technical story is entirely rewritten.

If Chainlink breaks below the neckline at $13, technical signals will clearly indicate a deeper downtrend that is hard to avoid. Meanwhile, the current support zone still exists, opening opportunities for a short-term recovery or even further growth. But unless LINK can break through the resistance layer and eliminate these bearish structures, the overall trend will still favor the sellers. Currently, with a 34.76% decline over the past year, the market is waiting for the next decisive signal.