The Cardano price has rallied significantly over the past week and secured more than a 24% gain. Over the last 24 hours, the coin slipped 2%, indicating that it could not sustain its weekly gains. Following a significant price increase, the technical outlook indicates that the altcoin’s price will trend lower.
This correction might continue over the subsequent trading sessions; however, the ADA daily chart has pointed towards a bullish pattern. This translates to the reading that ADA could attempt to rise on its chart after a brief retracement.
As Bitcoin continues to post appreciation in the last 24 hours, many altcoins are attempting to rise on their charts, but some altcoins are also struggling under their crucial resistance levels. The accumulation of Cardano took a dip on the daily chart, indicating a fall in demand for the altcoin.
This fall in demand is a result of the Cardano price correcting itself. Despite a fall in demand, buyers continued to have the upper hand. The market capitalization of Cardano increased, indicating that the bulls were still around. For Cardano to stop its downward movement, the coin has to sustain itself above the $0.28 price line.
Cardano Price Analysis: One-Day Chart
ADA was trading at $0.30 at press time. The coin recently fell from the $0.31 mark due to the daily loss on its chart. Overhead resistance for the Cardano price was at $0.33; a move above will help ADA recover significantly.
On the other hand, ADA has to remain above the immediate support level of $0.28. Failing to stay above the $0.28 mark will drag the altcoin down to $0.24. ADA might trade close to $0.28 before it starts to recover.
The altcoin displayed the cup and handle pattern, which is considered to be a bullish price pattern. In this pattern, the asset descends slightly before moving north. The amount of Cardano traded in the last session was green, pointing towards more buyers.
The technical outlook for ADA remained bullish, with buying strength declining slightly. Cardano’s price was no longer overbought, but buyers still exceeded sellers in the market. The Relative Strength Index recorded a multi-month high.
The indicator was above 60 despite the downtick, meaning buying strength was greater than selling. On that same note, the ADA price shot past the 20-Simple Moving Average line (SMA), suggesting that buyers were driving the price momentum. Cardano was also above the 50-SMA line as the bulls were still around.
The Moving Average Convergence Divergence that tells the price momentum and reversals was bullish with green signal bars.
These green histograms were buy signals; however, the bars were declining in size, suggesting an impending fall in the asset’s value. Bollinger bands expanded heavily in anticipation of an explosive price move, depicting further price volatility.
Featured Image From Unsplash, Charts From TradingView.com
Read the full article here