Cardano (ADA) cryptocurrency is at a critical juncture where it could either achieve significant gains or face even steeper declines. The factors that will determine price movements include technical outlook, community support, and network development.
ADA’s price has been on an upward trend since October 19, with resistance at $0.4 being seen as a significant threshold, and the price is exhibiting similar U-shaped rising and falling patterns. ADA’s current price at $0.38 shows that the bulls have taken control in the short term by pushing the price up from the $0.37 support level.
The MACD indicator may provide a buy signal in the upcoming trading sessions on ADA’s chart, potentially strengthening the bullish trend. Buyers, particularly those looking to avoid sudden drops, should wait for the blue MACD line to cross above the red signal line. Even though the 50-day Exponential Moving Average (EMA) (red) currently caps the rise at $0.381, a move above this level will boost the confidence of buyers targeting above $0.4.
In the short-term bullish scenario, the $0.4 level emerges as a significant factor due to seller density. Breaking this level could enhance positive sentiment and lead to a rally above $0.5, and even towards $1.
On the other hand, if the $0.4 resistance is not breached and investor confidence decreases, an increase in selling pressure is expected. In this case, ADA could pull back to lower support levels to accumulate liquidity for the next rise and increase volatility.
According to on-chain data compiled by IntoTheBlock, Cardano is moving above a significant demand zone between $0.37 and $0.38. Approximately 166,000 wallet addresses have purchased 4.88 billion ADA in this area. If this zone is surpassed, a new bullish wave could form, possibly driving ADA’s price to the highest levels of the year.