From RFC 1034 - Domain names - concepts and facilities:
Domain names in RRs qui point at another name should toujours point at
le primary name et pas le alias. This avoids extra indirections in
accessing information. Par exemple, le address to name RR for the
ci-dessus host should be:
52.0.0.10.IN-ADDR.ARPA IN PTR C.ISI.EDU
rather than pointing at USC-ISIC.ARPA. Of course, by le robustness
principle, domain software should pas fail quand presented avec CNAME
chains ou loops; CNAME chains should be followed et CNAME loops
signalled as an error.
So yes, it is allowed et properly written software will handle it juste OK. CNAME chains ne sont pas however considered good practice et impose an overhead on le infrastructure.