Cardano (ADA) Price Analysis: Downside Thrust Before Fresh Increase Likely
- ADA price traded to a new monthly high at $0.0903 before correcting lower against the US Dollar.
- The price is currently trading below the $0.0850 level and the 55 simple moving average (4-hours).
- There is a key declining channel or a bullish flag forming with resistance near $0.0850 on the 4-hours chart (data feed via Kraken).
- The price could dive sharply towards the $0.0750 support or $0.0720 before a fresh increase.
Cardano price is trading nicely in an uptrend against the US Dollar and bitcoin. ADA price might correct further in the short term, but it remains well supported above $0.0720.
Cardano Price Analysis
In the past few days, cardano price remained in a decent uptrend above the $0.0700 resistance against the US Dollar. The ADA/USD pair gained pace above the $0.0800 level and the 55 simple moving average (4-hours).
The price traded to a new monthly high at $0.0903 and recently started a downside correction. There was a break below the $0.0880 and $0.0850 support levels. It broke the 23.6% Fibonacci retracement level of the upward move from the $0.0725 low to $0.0903 high.
It is now trading well below the $0.0850 level and the 55 simple moving average (4-hours). It seems like there is a key declining channel or a bullish flag forming with resistance near $0.0850 on the 4-hours chart.
On the downside, an initial support is near the $0.0810 level or the 50% Fibonacci retracement level of the upward move from the $0.0725 low to $0.0903 high.
If there is a downside break below the channel support zone, there is a risk of more losses below the $0.0800 support. The next support is near the near the $0.0750 level, below which the price may perhaps extend its decline towards the $0.0720 support zone.
Conversely, the price could break the channel resistance at $0.0850 and continue higher. An immediate resistance could near the $0.0880 level, above which the price might rise sharply above the $0.0900 resistance.
The chart indicates that ADA price is trading in a positive zone above the $0.0800 and $0.0720 support levels. In the short term, there could be a downside thrust towards $0.0750 or $0.0720 before the price starts a fresh increase in the near term.
4 hours MACD – The MACD for ADA/USD is now gaining momentum in the bearish zone.
4 hours RSI – The RSI for ADA/USD is currently well below the 50 level.
Key Support Levels – $0.0800 and $0.0720.
Key Resistance Levels – $0.0850 and $0.0900.