Can Cardano bulls trigger a 60% relief rally amidst a bearish backdrop?
|- Cardano price shows potential for a 60% run-up to retest the weekly resistance barrier at $0.776.
- The relief rally could stop prematurely if the buyers fail to flip the $0.550 hurdle into a support level.
- A daily candlestick close below the $0.380 support level will invalidate the bullish thesis for ADA.
Cardano price seems to be making quite a comeback after crashing violently over the past few days. This massive downswing is a common theme across all cryptocurrencies as the bear market rages on. However, for ADA, a relief rally seems to be incoming.
Cardano price ready for a quick bounce
Cardano price shows that it produced three daily candlestick closes around the $0.470 level between May 11 and June 14. Although not a textbook representation, this setup looks like a triple bottom, which is a bottom reversal pattern, often formed at the end of downswings.
Additionally, the sellers seem to be taking a break, allowing Bitcoin, Ethereum and other altcoins to bounce and recover a part of the losses. With these two supporting factors, Cardano price seems to be ready for a quick relief rally as well.
The upside objective seems to be roughly 60% away from the current level at $0.486, which is the weekly resistance barrier. However, climb to this barrier is not an easy task; ADA needs to flip the $0.550 hurdle into a support floor, which is a starting step.
Beyond this, Cardano price needs to muster enough bullish momentum to not just produce a higher high above the June 8 swing point at $0.66, but sustain it so ADA can climb up and retest the $0.486 level.
While the 60% returns might seem appealing, the journey to this level is a taxing one. Regardless, investors need to observe ADA closely.
ADA/USDT 1-day chart
On the other hand, if Cardano price produces a daily candlestick close below the weekly support level at $0.380, it will produce a lower low and invalidate the relief rally thesis. In such a case, Cardano price might crash 26% and revisit the $0.278 barrier.
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