Cardano buying opportunity will occur after crash to $0.35
- Cardano price action displays clear bearish continuation activity.
- A return and further collapse below the 2022 lows are expected.
- Upside potential exists but is increasingly unlikely.
Cardano price action is in a tough spot for bulls. Yesterday’s close above the Tenkan-Sen was the first close above that Ichimoku level since April 4, 2022. Unfortunately for bulls, bears have taken clear control during the Friday session and have returned ADA below the Tenkan-Sen and close to yesterday’s open.
Cardano price setup for a quick crash and then a violent recovery
Cardano price is positioned perfectly for a strong bearish push. The bearish continuation pattern and continued rejection against the weakest level within the Ichimoku Kinko Hyo system (the Tenkan-Sen) shows a lack of bullish conviction and defense.
The critical level to watch for Cardano price is the $0.49 level. If ADA closes the daily candlestick at or below $0.49, it will be under the current high volume node. The 2022 and 2021 Volume Profiles show extremely thin traded prices until the next high volume node at $0.35.
ADA/USD Daily Ichimoku Kinko Hyo Chart
Analysts and traders interpret price action behavior in the Volume Profile as such: when the price moves above/below a high volume node, it will move to the next high volume node very quickly, but that depends on how thin the volume is between the two nodes. The thinner the volume, the faster they move. Therefore, for Cardano price, the most would likely be swift.
If bulls want to invalidate any further near-term bearish sentiment, they’ll need to push Cardano price to at least a close above the Kijun-Sen – at or above $0.66.
Author
Jonathan Morgan
Independent Analyst
Jonathan has been working as an Independent future, forex, and cryptocurrency trader and analyst for 8 years. He also has been writing for the past 5 years.
