• Cardano price continues to be influenced by the 2018 high of $1.39.
  • ADA may be developing an inverse head-and-shoulders pattern on the four-hour chart.
  • Institutional inflows into ADA investment products jumped by $10 million last week while Bitcoin and Ethereum saw outflows.

Cardano price has traded around the 50-day simple moving average (SMA) for the past seven days, and it is on pace to close May with a double-digit gain. ADA will confront more volatility daily, but it remains well-positioned to be one of the leading digital tokens moving forward.

Cardano investment products attract more capital than any other digital asset

According to the latest CoinShares Digital Asset Fund Flows Weekly report, digital assets saw net institutional outflows for the second consecutive week, totaling $97 million and marking a new record for outflows. To provide perspective, it represents just 0.2% of total assets under management (AUM), and it does not compare to the total YTD net inflows of $5.5 billion.

Bitcoin had total outflows of $110.9 million following outflows of $115 million in the previous week. It was the second consecutive week that BTC recorded outflows of over $100 million. Ethereum showed $12.9 million in outflows, but it is a minor setback in a year of record-breaking inflows for the smart contracts token.

Altcoins saw continued positive sentiment with inflows totaling $27 million. Cardano showed the largest institutional inflows at $10 million. It was the second consecutive week of ADA inflows, lifting the YTD inflows to $24 million for Cardano institutional investment products. Coinbase suggested that the robust inflows may “represent investors actively choosing proof of stake coins based on environmental considerations.”

Indeed, environmental considerations have taken center stage in the cryptocurrency complex due to the notable impact mining has on the earth. Elon Musk was instrumental in elevating those concerns to mainstream media when he decided that Tesla would no longer accept BTC as a payment method because of the tremendous power usage, primarily derived from fossil fuels.

Cardano price searching for stability in a market overwhelmed with apprehension   

At the May 19 crash low, Cardano price had fallen over 50% for the day, over 60% from the all-time high at $2.51, and the decline had dismantled the 180% rally from the April 23 low. However, by the end of the day, ADA had rebounded by 50%, lifting it above the tactically important 50-day SMA.

On May 23, Cardano price suffered another wave of heavy selling pressure, knocking the digital token down almost 30% at the intra-day low, but again, ADA rebounded by 25%.

Despite the volatility over the last six days, Cardano price has respected two crucial price levels. The 2018 high at $1.39, and the February 27 high at $1.54. Locked in between the two price levels is the 50-day SMA at $1.46.

ADA/USD daily chart

ADA/USD daily chart

In the short term, there is a high probability that Cardano price will oscillate along the two price levels and the 50-day SMA, releasing the price compression from the last week’s volatility.

It is essential to note that Cardano price on the four-hour chart is shaping an inverse head-and-shoulders pattern that could trigger in the next few hours. The trigger price for the opportunistic formation is $1.66, slightly above the 50 four-hour SMA at $1.63. 

Key resistance levels include the 61.8% Fibonacci retracement of the May crash at $1.68, the May 20 high at $1.98 and then the 78.6% retracement at $1.99.

ADA/USD 4-hour chart

ADA/USD 4-hour chart

A daily close below yesterday’s low at $1.23 would alert investors to another steep drop in Cardano price, potentially down to the May 23 low at $1.04 or even to the May 19 low at $0.91. A decline below the April low at $0.89 would introduce a deeper, secular decline for ADA.

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

Where Bitcoin, Ethereum prices are headed as correlation with S&P 500 declines

Where Bitcoin, Ethereum prices are headed as correlation with S&P 500 declines

A mysterious Bitcoin whale moved a large volume of BTC that was dormant for a decade. Amidst the breaking correlation between Bitcoin and S&P 500, analysts are bearish on BTC price. 

More Bitcoin News

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Patience is key until markets hit this level

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Patience is key until markets hit this level

Bitcoin price shows a steep sell-off over the last 24 hours that has undone the gains seen between September 21 and 24. This correction has caused Ethereum, Ripple and other altcoins to crumble as well. 

More Cryptocurrencies News

Dogecoin price provides sidelined buyers another opportunity before a 50% rally

Dogecoin price provides sidelined buyers another opportunity before a 50% rally

Dogecoin price undid its gains seen between September 21 and 24 as it came tumbling down, following the footsteps of Bitcoin price. This downtrend has provided sidelined buyers a chance to accumulate before the inevitable explosion of bullish momentum that triggers an exponential rally. 

More Dogecoin News

Binance Coin price could shed more than 10% if this trend continues

Binance Coin price could shed more than 10% if this trend continues

Binance Coin price has been on a downtrend for quite some time and has intensified after the recent sell-off in Bitcoin price. Investors need to pay close attention to the BNB’s moves over the last three weeks, which revealed a bearish setup.

More Binance Coin News

Bitcoin makes a bullish comeback amid regulatory tension, but lacks confirmation

Bitcoin makes a bullish comeback amid regulatory tension, but lacks confirmation

Bitcoin price takes the first step to recovery but needs solid confirmation that will arrive after a flip of the $19,539 level into a support floor. After a successful flip, investors could expect a move up to an intermediate hurdle at $20,737.

Read full analysis

BTC

ETH

XRP