Cardano Price Analysis: ADA remarkable upswing hits pause as sell signals linger
|- Cardano upside stalls short of $0.28 after an 82% upswing since January 1.
- A sell signal on the 4-hour hints at an imminent breakdown, perhaps to $0.20.
Cardano has been on a massive upswing since the beginning of the year. In less than seven days, the staking token has grown by more than 82% to exchange hands at the new yearly highs of around $0.2750. However, it seems that a reversal may come into the picture in the coming sessions, perhaps erase some of the gains made.
Cardano’s 24% upswing could be in jeopardy
ADA is doddering at $0.265 at the time of writing. Over the last 24 hours, the smart contract token has accrued more than 24% in gains and bagged nearly 44% in the past seven days. The sevenths largest cryptocurrency must close the day above $0.26 and preferably overcome the hurdle at $0.28 to sustain the uptrend towards $0.30.
On the downside, losses will come into the picture if Cardano makes a daily close under $0.26. Besides, the Relative Strength Index shows that ADA/USD is in oversold conditions. Therefore, buying volume is most likely to decrease as the seller grip strengthens. A rejection from the current price levels will seek support at $0.20, $0.18, and $0.14, in that order.
ADA/USD daily chart
The TD Sequential indicator has presented a sell signal on the 4-hour chart in the form of a green nine candlestick. The pessimistic outlook suggests a correction in one to four daily candlesticks. A red two candlestick trading below a preceding red one candle could serve as confirmation that Cardano is poised to drop further.
ADA/USD 4-hour chart
The bearish narrative is likely to be confirmed if Cardano fails to break through the immediate resistance running from $0.259 - $0.266, as shown by IntoTheBlock’s IOMAP model. Here, 502 addresses had previously bought roughly 17 million ADA.
Cardano IOMAP chart
On the downside, the most robust support is highlighted between $0.228 and $0.0.236. Approximately 1,300 addresses had previously bought nearly 16 million ADA in the range. Upward correction is unlikely to continue. Hence the possibility of a correction or consolidation taking precedence in the near term.
On the other hand, a bullish picture will come into the picture if ADA/USD embraces support above $0.26. Moreover, trading past the stubborn resistance at $0.275 may open the road for gains towards $0.30 and perhaps restart the uptrend aiming for $0.4.
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.