• Cardano price will meet strong resistance near $1.20.
  • 50 twelve-hour simple moving average (SMA) has turned down for the first time since December 2020.
  • Head-and-shoulder top pattern fortifies the bearish outlook.

Cardano price is trading heavy in the context of a developing head-and-shoulders top. Based on price symmetry, traders should expect a drift higher over the next 2-3 days before ADA breaks below the neckline.

Cardano price risk greatly outweighs reward 

Only six days ago, ADA was near the all-time high and looked primed for a solid breakout to at least the 1.618 Fibonacci extension level at $1.79. A wave of doubt has overcome the cryptocurrency and forced it below the 50 twelve-hour SMA at $1.17, creating the right shoulder of the head-and-shoulders top. 

A break below the neckline at $1.08 will find actionable support at the 100 twelve-hour SMA at $1.02 and the psychologically important $1.00 level. Additional support should materialize at the 0.382 Fibonacci retracement level at $0.95.

The bearish path for ADA will soon lead to the 0.50 retracement level at $0.78, which is slightly below the February 23 low at $0.80, and the hammer close on February 15 at $0.84. It will be formidable support and represent a 28% decline from the neckline.

ADA/USD 12-hour chart

ADA/USD 12-hour chart

Cardano price should drift higher over the next 2-3 days, but a close above the left shoulder at $1.16 on a 12-hour candlestick will void the head-and-shoulders pattern and reset traders’ sights on a new all-time high. After clearing $1.485, bulls have the opportunity to rally ADA to the 1.618 Fibonacci extension at $1.79.

The 5th ranked cryptocurrency by capitalization is highly speculative. Hence, traders need to be precise in taking their entry points to ensure there is some space to manage the volatility and avoid triggering their stops too early.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Crypto bulls unfazed by flash crash

Bitcoin price action initially shakes off strong selling pressure, finds buyers at support, then resumes some selling pressure. Ethereum price action mixed post-all-time high rejection. XRP price awaits its own bullish breakout and an opportunity to outperform its peers.

More Cryptocurrencies News

MATIC price ready for new all-time highs as $188 million flow into Polygon

The total number of transactions on Polygon network dropped nearly 15% due to a rise in transaction fees over the past week. This hasn’t negatively impacted the network as the number of unique daily active users remained stable. 

More MATIC News

AVAX price offers a bullish opportunity before Avalanche hits new all-time highs

Avalanche (AVAX) price has seen a bullish outbreak on Thursday after it broke out above – and then retested – the red descending trend line at $61.62. With even more buyers and bulls coming in, expect a run towards new all-time highs at $81.

More AVAX News

XLM price building base for bullish breakout

Stellar bulls are in the last phase of completing a bullish triangle. As XLM price is getting squeezed against the base ($0.40), expect a quick breakout of 12%. After taking a breather, expect another 10% of profits to follow. 

More Stellar News

BEST CRYPTO BROKERS/EXCHANGES




Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast

BTC

ETH

XRP