Cardano (ADA) Price Analysis: Bullish Signs Despite Fall Below Key Support Level
Read our Cardano (ADA) price analysis to discover potential bullish signs despite a fall below a key support level. Find out the latest price predictions and technical analysis.
Posted 2 months ago in Market Analysis
The price of Cardano (ADA) is currently trading inside a corrective pattern, but there are bullish signs indicating a potential trend reversal. ADA has formed a bullish double-bottom pattern, although it has fallen below an important horizontal support level.
On the bearish side, ADA has dropped below the critical $0.26 support area that has been holding since June 10. However, it is still hovering just above the $0.25 support level, which has been in place since the beginning of the year.
Despite the recent pullback, there are several factors suggesting a bullish outlook for ADA. The price has been moving inside a descending parallel channel since July 14, which typically indicates a corrective pattern. If this is the case, a breakout from the channel is likely in the near future.
Additionally, ADA has formed a double-bottom pattern since August 14, which is considered a bullish signal. This pattern is also accompanied by a bullish divergence in the RSI, indicating a potential trend reversal.
If ADA breaks out from the channel, it could see a 30% increase to the next resistance at $0.32. However, if the price gets rejected, a 20% drop to the channel's support line at $0.20 is a possibility.
On the shorter-term six-hour chart, there are mixed readings. ADA has broken out from a descending resistance line, but it is still trading below the minor $0.25 horizontal area. The RSI is increasing but has not crossed above 50 yet, which is necessary to confirm a bullish trend.
In conclusion, the future price prediction for ADA will depend on whether it breaks out from the channel and reclaim the $0.26 area or faces rejection. A breakout could lead to a 30% price increase, while rejection may result in a 20% drop.
Last updated 9/16/2023, 1:05:19 AM
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