Cardano price is still under bearish pressure as the downturn continues

Cardano (ADA) price is still under pressure from its rejection by the 55-day Simple Moving Average at $0.97 on April 20. Since then, ADA price has been trading lower as more bearish pressure mounts and dollar strength adds a double weight to the downtrend. Expect downside to continue  towards $0.80 or $0.69 with either 13% or 22% losses.

ADA price at risk of undergoing dollar gravity, dropping 22%

Cardano price has been trying to shake off the tail risks that came along with the situation in Ukraine. The election of Macron for a second term securing political stability in the plagued European block should have helped, but instead, since Sunday night, the Greenback has been rallying against all major currencies, including cryptocurrencies, as investors run for cover due to fear of more  lockdowns and supply chain disruptions stemming from the covid outbreak in China. With that spillover effect, most cryptocurrencies are on the back foot, except for the few under Elon Musk’s wing and are trading higher for the day.

In the first correction phase, ADA price will drop to $0.80 and look at the support offered at the beginning of March. If that fails, expect to see a further continuation towards $0.69 with a level that goes back to February 15, 2021. With another 22% loss, ADA price is nearly set to print a new year low. If that transpires, bears will have lost some force in profit-taking and with not much fuel left to eke out further gains, the dollar index will have hit a substantial level in EUR/USD and other currencies. A correlation to keep in mind. 

ADA/USD daily chart

One should almost forget that it is the earning season in the US. This evening, two big tech corporations are set to make a scene. Microsoft and Alphabet are the first of six big tech names that mainly represent most of the Nasdaq and are set to put out earnings. Should those surprise to the upside and show no sign of weakness against the current inflation backdrop, expect to see Nasdaq popping higher by multiple percentage points, which will spill over into cryptocurrencies and drag those higher, with ADA Price revisiting $1.00.