• Cardano price records a significant reversal at the 2018 high, reminding investors of February, March, and April struggles.
  • 50-day simple moving average (SMA) becoming influential again, restricting upside price traction.
  • ADA symmetrical triangle's upper trend line is a good source of support for any weakness.

Cardano price was firmly rejected at the 2018 high on July 26, emphasizing the importance of the level in securing a renewed and sustainable rally to the all-time high. Unless $1.40 can be broken on a daily closing basis, ADA is far from bullish outcomes.

Cardano price breakout carries no spirit, questioning the viability

On July 26, Cardano price resolved the long-standing symmetrical triangle with a daily close above the upper trend line. It was the culmination of the brief rally that began on July 21 after ADA fooled investors with a bear trap.

Since the breakout, Cardano price has struggled with the 50-day SMA, similar to the failed ADA attempts in mid-June that resulted in a new wave of selling, ending with the June 22 low at $0.98.

The measured move of the symmetrical triangle pattern is close to 63%, signaling a Cardano price target of $2.01, putting ADA less than 30% away from the all-time high of $2.51 printed on May 16.

ADA/USD daily chart

ADA/USD daily chart

From an intraday perspective, Cardano price could be shaping a cup-with-handle pattern that may provide the foundation for a sustainable advance and a successful test of the symmetrical triangle’s measured move target of $2.01.

The measured move of the cup-with-handle base is just over 37%, generating an ADA price target of $1.93, very close to the symmetrical triangle price target. Adding to the symmetry of the price structure is that the high of the handle is $1.40, further emphasizing how important the 2018 high is to bullish outcomes for Cardano price.

Thus, if Cardano price can sustain an advance above $1.40, ADA should be primed to target the range of $1.93-$2.01.

ADA/USD 6-hour chart

ADA/USD 6-hour chart

On the downside, Cardano price is supported by the confluence of the 200-day SMA at $1.19 with the symmetrical triangle’s upper trend line. Any weakness below the moving average will encourage a test of the triangle’s lower trend line at $1.07. If there is a collective sell-off in the cryptocurrency complex, ADA may reach the 61.8% retracement of the rally from March 2020 at $0.97.

Based on the price action over the 4-5 days, the Cardano price breakout from the symmetrical triangle does not look viable, but a close above $1.40 would change that statement, triggering the cup-with-handle pattern and swiftly pushing ADA to the $1.93-$2.01 range.

Here, FXStreet's analysts evaluate where ADA could be heading next as it seems bound to breakout.

 

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Cryptos feed Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Why Polygon’s MATIC bulls could be too eager and drop the ball on this rally

Why Polygon’s MATIC bulls could be too eager and drop the ball on this rally

Polygon (MATIC) price action has been on treading nervously this week, with weekly earnings switching back and forth between profit and loss. It all comes down to trading this Friday to see if bulls can eke out a winning week.

More Polygon News

How can traders squeeze in more gains as Shiba Inu price teases a 42% rally

How can traders squeeze in more gains as Shiba Inu price teases a 42% rally

Shiba Inu price positively reacted to the United States inflation report, forming a bullish candle on its daily chart. The second-largest meme coin brushed shoulders with $0.00001287 but pulled back to test support highlighted by the 100-day Simple Moving Average (SMA) at $0.00001170.

More Shiba Inu News

CRO price sees bulls using their last ammunition to attack $0.16

CRO price sees bulls using their last ammunition to attack $0.16

Crypto.com Coin (CRO) price action is looking to execute a bullish breakout above $0.16. Ignorant bulls will try to be part of that rally, but that could prove a big mistake as a few risks need to be taken into account to be sure that this rally still has legs.

More Crypto.com News

Solana traders’ focus on $58 as the rally starts to slow down

Solana traders’ focus on $58 as the rally starts to slow down

Solana (SOL) price action is set to close out the week with a mere 7% gain depending on where it ends  Friday evening after the US closing bell. Overall it has been a good trading week from a fundamental perspective and technicals in a supporting role.

More Solana News

Bitcoin: If bulls lose control here, BTC could revisit $21,000

Bitcoin: If bulls lose control here, BTC could revisit $21,000

Bitcoin price shows an interesting setup that could reveal its next move. On closer inspection,  its technicals support a bearish outlook for the leading crypto.  

Read full analysis

BTC

ETH

XRP