Following a month-long corrective phase, Cardano‘s (ADA) value has diminished by 28.5% from a high of $0.8 to a pivotal support level of $0.57. This movement has raised considerable attention among investors and traders regarding the future trajectory of the cryptocurrency.
Cardano’s Bearish Pattern Emerges
The ongoing price correction has shaped a head and shoulders pattern on Cardano’s price chart, suggesting that ADA may face further declines. This bearish formation, coupled with the current market sentiment leaning towards correction, suggests a potential downturn. The critical neckline of this pattern is situated at the $0.567 mark, which is currently acting as a key support level for the crypto asset.
Despite the grim pattern, there exists a possibility for bullish support to catalyze a turnaround, igniting a robust upward price trend. If the bearish scenario is averted, ADA might exhibit a double bottom formation, testing a longstanding support trend line.
Predictions on ADA’s Price Movement
At present, ADA trades at $0.58, suffering a 1.93% intraday loss, which suggests mounting supply pressure. Nonetheless, the emergence of a tail on the daily chart indicates price rejection at lower levels, hinting at a possible trend reversal. If the price manages to bounce back from this double bottom, a climb to $0.68 is conceivable. However, failing to maintain the critical support could trigger a further 20% depreciation to $0.46.
Considered Points
- ADA’s correction formed a bearish head and shoulders pattern, indicating potential further decline.
- A breakdown below the $0.567 support might signal the start of a new downward correction.
- A reversal from the current support could pave the way for ADA to ascend to $0.68.
Market analysts believe the correction phase might be nearing its end, suggesting a bullish breakout could be on the horizon. However, a slip below the crucial support level could spell a new round of sell-offs for Cardano.