Should Cardano holders prepare for another upswing or a steep correction
- Cardano price and its holders are in a pickle as ADA trades around $1.20.
- The $1.22 to $1.35 breaker is a significant hurdle that prevents bulls’ march to $1.60.
- A daily candlestick close below $1 will invalidate the bullish thesis.
Cardano price shows a slowdown in momentum after a quick run-up from a psychological level. This move faces a massive blockade that could make or break the uptrend for ADA.
Cardano price at inflection point
Cardano price action from February 19 to March 23 set up a V-shaped valley known as “Adam.” This move was followed by a rounded bottom formation referred to as “Eve”. The Adam and Eve formation is a bottom reversal pattern that forecasts a 25% upswing, determined by measuring the depth of the valley and adding it to the breakout point at $1.
Based on the theoretical forecasting methods, the target for ADA is $1.26. After its breakout on March 23, Cardano price quickly rallied 23% but failed to reach its destination. This lack of momentum was due to the bearish breaker formed on January 13. This area extends from $1.22 to $1.35 and is a major hurdle in the bulls’ path.
Clearing this blockade will allow Cardano price to reach its Adam and Even target at $1.26 and trigger a rally to $1.60. In total, this move would constitute a 35% upswing from the current position at $1.17.
ADA/USDT 1-day chart
Supporting this move for Cardano price to $1.60 is IntoTheBlock’s Global In/Out of the Money (GIOM) model. This index shows that the bulls are already grappling with a major hurdle at $1.17.
Clearing this area opens the path for ADA up to $1.56, where roughly 583,000 addresses that purchased 6.18 billion ADA are “Out of the Money.” Therefore, a move into this area could trigger a spike in selling pressure from the market participants trying to break even. Hence, the upside for Cardano price is capped around this range which extends from $1.43 to $1.70.
ADA GOM
While the technicals point to a tough road ahead for Cardano price, investors need to be prepared for a move in either direction.
A daily candlestick close below $1 will invalidate the bullish thesis for Cardano price and end the Adam and Eve setup. This development could also open the path for bears to crash ADA to $0.85.
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.
