- Cardano price coils within a consolidating range since the spring of 2022.
- A second attempt of the $0.42 support zone could induce a 40% decline.
- Invalidation of the bearish thesis is a breach above $0.59.
Cardano price could set up for the final decline before a reversal occurs. Key levels have been identified.
Cardano price is setting up for one more decline
Cardano price has been reading range bound since May of 2022. The back-and-forth price action appears to have formed a large symmetrical triangle. The Relative Strength Index confirms the triangle idea as divergences between prices correlate with each swing high and swing low.
Cardano price currently auctions at $0.46. A Fibonacci Retracement tool surrounding the August through high at $0.59 and the most recent swing low at $0.42 shows the current downtrend catalyzed by the 61.8% Fibonacci level. Based on Elliott Wave and Fibonacci theory, the final E wave of the prospective triangle could be over.
ADA USDT
Thus, A reattempt of the $0.42 should not be taken lightly. If the triangle thesis is correct, an impulsive wave targeting $0.27 could occur in the coming weeks. Such a move would result in a 40% decline from ADA’s current market value. A double backtest towards the 61.8% fib level at $0.52 is still possible. Therefore under Elliott Wave Theory, invalidation of the bearish thesis should remain Wave C at $0.59.
Investors should remember that if the triangle thesis is validated, an explosive five-wave impulse should target the mid $0.20 level. Once the target is reached, investors could begin looking for a knife catch opportunity, as triangles are usually the last consolidation before a trend change occurs. A rally towards the all-time highs would result in a 500% increase from the current Cardano price.
In the following video, our analysts deep dive into the price action of Cardano, analyzing key levels of interest in the market. -FXStreet Team
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