Cardano price could crash 50% if ADA bulls fail to defend key support level
|- Cardano price retests the $0.805 support level, a breakdown of which could lead to a steep crash.
- A 50% crash to $0.381 is plausible based on the volume profile indicator
- A daily candlestick close above $1 will invalidate the bearish thesis for ADA.
Cardano price has been on a downtrend for the longest time and is currently retesting a vital support level. This foothold is crucial in preventing a massive correction to a level last seen in early 2021.
Cardano price heads south
Cardano price has crashed roughly 74% from its all-time high at $3.104 and is currently trading around $0.789. Based on the volume profile indicator, the volume traded for ADA thins out considerably after $0.805 up to $0.381.
Hence, a decisive close below $0.805 will give bears the control. Such a development would lead to a 50% crash from the current position to $0.381. Therefore, bulls have one last chance to make their efforts count.
Failing to do so could lead to a capitulation level crash. While bearish, it would signal that a bottom is in for Cardano price.
ADA/USDT 3-day chart
Cardano price has sliced through the 50-day, 100-day and 200-day Simple Moving Averages (SMAs) in the last four months or so. Any attempts to move higher were capped, leading to an extended bear rally.
However, if Bitcoin’s situation improves, there is a good chance Cardano price will see some bullish reaction as well. If ADA produces a decisive close above the 50-day SMA at $1, it will invalidate the bearish thesis.
In this case, the so-called “Ethereum killer” might make a run for the next crucial hurdle at $1.20, where the current volume point of control is present.
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.