- Cardano price has been consolidating for roughly two weeks, hinting at an explosive breakout.
- The bullish RSI divergence with ADA supports a 20% rally to $1.
- A daily candlestick close below the equal lows at $0.776 will create a lower low and invalidate the bullish thesis.
Cardano price has been stuck trading in a tight range for roughly two weeks with minor daily returns. This sideways movement is reminiscent of the one that occurred in late January and indicates that a bullish breakout seems likely.
Cardano price awaits a volatility blast
Cardano price showed a lack of volatility as it traded sideways from January 22 to February 3. This consolidation resulted in a bullish breakout that allowed ADA to rally 24% and set a swing high at $1.26.
However, the momentum was not enough and led to a retracement to lower areas. As Cardano price range tightens again, the sideways movement now is reminiscent of the earlier one. Interestingly, the Relative Strength Index (RSI) has set up higher lows since February 21 while ADA has set up lower lows, indicating the formation of a bullish divergence.
This technical formation forecasts a bullish move for the so-called “Ethereum killer,” adding credence to the bullish thesis. In the case of a breakout, investors can expect Cardano price to rally 20% and tag the $1 psychological level.
ADA/USDT 1-day chart
On the other hand, if bulls fail to muster up the strength to move higher, Cardano price is likely going to slide lower and collect the liquidity resting below equal lows at $0.776. This liquidity run is another chance for buyers to make a comeback.
However, a daily candlestick close below the equal lows at $0.776 will create a lower low and invalidate the bullish thesis for Cardano price. Such a move will open the path for ADA to explore the $0.676 support level after a 13% crash.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: BTC nosedives below $95,000 as spot ETFs record highest daily outflow since launch
Bitcoin price continues to edge down, trading below $95,000 on Friday after declining more than 9% this week. Bitcoin US spot ETFs recorded the highest single-day outflow on Thursday since their launch in January.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Solana Price Forecast: SOL’s technical outlook and on-chain metrics hint at a double-digit correction
Solana (SOL) price trades in red below $194 on Friday after declining more than 13% this week. The recent downturn has led to $38 million in total liquidations, with over $33 million coming from long positions.
SEC approves Hashdex and Franklin Templeton's combined Bitcoin and Ethereum crypto index ETFs
The SEC approved Hashdex's proposal for a crypto index ETF. The ETF currently features Bitcoin and Ethereum, with possible additions in the future. The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
Bitcoin: 2025 outlook brightens on expectations of US pro-crypto policy
Bitcoin price has surged more than 140% in 2024, reaching the $100K milestone in early December. The rally was driven by the launch of Bitcoin Spot ETFs in January and the reduced supply following the fourth halving event in April.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.