Cardano price likely to trap early ADA bulls before a 20% upswing
- Cardano price has witnessed a 5% ascent in the last 12 hours after tight consolidation over the weekend.
- The initial rally might trap early ADA bulls and a ploy to liquidate bears before a strong 15% rally kickstarts.
- A four-hour candlestick close below $0.354 will invalidate the bullish thesis for the so-called “Ethereum killer.”
Cardano price set up a local top on April 15 and triggered a massive slump, which could be due to investors booking profits. As ADA retraced, it set up a base and tightened in a range over the weekend before breaking out on April 25.
Cardano price to pause before a bounce
Cardano price rallied 35% between March 27 and April 15 and set up a local top at $0.462. After the upswing, bulls were left exhausted and investors chose to book their profits.. As a result, ADA retraced 18% and set up a foothold at $0.378.
On April 25, Cardano price saw a 5% uptick that pushed it close to the high timeframe resistance level at $0.401 but failed to retest it. The likely move for ADA is to undo the recent gains. In some cases, there might be prolonged selling to trap early bulls and lure greedy bears.
A sweep of the equal lows at $0.369 for sell-stops will be a key level for Cardano price to reverse from. A bounce off the four-hour bullish breaker at $0.359 to $0.354 will also be a good level to accumulate ADA.
In its ascent, Cardano price needs to overcome the $0.401 hurdle, which will allow ADA bulls to propel to the $0.427 and $0.431 levels. This move would bring the total gain to 20%.
ADA/USDT 4-hour chart
While the outlook for Cardano price seems a little ambiguous, investors need to note that a four-hour candlestick close below $0.354 will be the turning point. This move would create a lower low and invalidate the bullish thesis.
In such a case, Cardano price could retrace and tag the $0.341 support level.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
