Cardano price reclaims critical support, but ADA buyers nowhere to be found


  • Cardano price managed to reclaim a significant level that has saved the asset from falling further.
  • Moving forward, ADA must close above the 200-day SMA for any chance of it seeing a recovery. 
  • Cardano may continue to move sideways as indecision mounts.

Cardano price has been regaining strength after losing crucial support on July 19. However, ADA continues to be consumed by indecision, as the asset is witnessing an equilibrium between buyers and sellers.

Cardano price faces a tough call

Cardano price has printed a descending triangle pattern on the daily chart, presenting a bearish bias for ADA. 

The prevailing chart pattern suggests ADA bulls could be vulnerable. However, Cardano price has generated an oversold reading shown by the Relative Strength Index (RSI) on July 20. ADA rebounded nearly 18% to $1.22 on July 20, closing above a critical support level.

Cardano price appears to have reclaimed the 200-day Simple Moving Average (SMA), and this level continues to act as a crucial line of defense for ADA. 

Despite the bearish bias given by the prevailing chart pattern, Cardano price may look to tag the hypotenuse of the triangle in the next few days, coinciding with the 50% Fibonacci extension level at $1.26, near the 20-day SMA. Only a close above the 200-day SMA could signal a recovery for ADA. 

ADA USDT

ADA/USDT daily chart

Considering the lack of buying pressure, further targets to the upside are unlikely at the moment, as the upper boundary of the triangle has acted as stiff resistance for ADA since May 19. However, a breakout above this level could indicate a potential rally for Cardano price, with the highest level expected at $1.75, presented by the governing technical pattern of almost a 53% surge. 

To effect the aforementioned ambitious target, ADA would need to slice through the 50-day SMA corresponding to the 78.6% Fibonacci extension level.

The lackluster trading volume witnessed by ADA suggests that Cardano is likely to continue to move sideways as indecision mounts.  

Falling below the 200-day SMA could spell trouble for the bulls, as Cardano would potentially see a retest of the swing low at $1.02 before slumping further below to the base of the triangle at $1.00.

Should ADA witness further selling pressure, investors should expect Cardano price to collapse toward the lower boundary of the demand zone that starts at $0.92, the April low. 

 

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

SafeMoon price needs to rally 14% to kick-start an uptrend

SafeMoon price is currently attempting to push toward the range low in hopes of reclaiming it. If successful, the bulls need to set up a higher high to trigger an uptrend. While not impossible, an ascent in the market value of SAFEMOON will likely face delays.

More SafeMoon news

Goldman Sachs survey reveals almost 50% of family office clients want to get into crypto

Family offices are interested in digital assets, as revealed in a recent survey by Goldman Sachs. Nearly half of the respondents have shown interest in cryptocurrencies. 5% of family offices that work with Goldman Sachs have ...

More Cryptocurrencies news

Elon Musk reveals personal crypto holdings, Tesla likely to resume accepting Bitcoin

Elon Musk has once again rescued the crypto markets after revealing that he personally holds Bitcoin, Ethereum and Dogecoin. The Tesla CEO further disclosed that the electric vehicle company is “likely” to resume accepting the leading cryptocurrency.

More Bitcoin News

Dogecoin price ends aimless descent as bulls announce 27% upswing

Dogecoin price is currently undergoing a pullback after rallying extensively. This up move comes after months of a slow and non-volatile downtrend, painting a bullish picture. Therefore, the newly developed optimism will likely continue ...

More Dogecoin 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