- Cardano price shows a string of equal lows formed at $0.425, indicating a potential liquidity run in the near future.
- Investors can enter the ADA market after the sell-stop liquidity below $0.425 is swept.
- A daily candlestick close below $0.425 without a quick recovery above $0.435 will invalidate the bullish outlook.
Cardano price has remained neutral despite the blockchain undergoing a massive upgrade this week via the Vasil hard fork. This update is multi-faceted and brings a host of improvements to the so-called “Ethereum-killer”, including transaction throughput.
Other notable improvements include “diffusion pipelining”, which increases the Cardano blockchain network’s transaction processing capabilities while also improving the block propagation times.
The developers commemorated a successful implementation on September 28 on Twitter.
We’re pleased to announce that after a successful #Vasil upgrade on the 22nd of Sept, the new capabilities (including node & CLI support for reference inputs, inline datums, reference scripts), along with a new #Plutus cost model, are now available on the #Cardano mainnet! pic.twitter.com/USja3TcJNi
— Input Output (@InputOutputHK) September 27, 2022
Although a major milestone for the developers and users alike, Cardano price failed to react to it. In fact, ADA has been consolidating and has remained highly correlated to Bitcoin price.
Cardano price and the signals before a run-up
Cardano price has been producing liquidity fractals, which are essentially a sweep of the previously formed swing low followed by a quick rally. So far, ADA has produced eight of these and will likely produce one more before buyers step on the gas pedal.
The so-called “Ethereum-killer” has produced three equal lows at $0.425 and has sell-stops resting below it. Therefore, a swift move to the downside to collect this liquidity, followed by a swift recovery above $0.435, will indicate that market makers are at work and also signal a bullish outlook.
In such a case, investors can expect Cardano price to trigger a 15% run-up to $0.505, where a local top could form. Depending on the momentum, ADA could extend higher and fill the imbalance, aka Fair Value Gap (FVG), at $0.530.
In total, this move would constitute a 25% gain for Cardano price, and interested investors can look to get in after a sweep of the equal lows at $0.425.
ADA/USDT 4-hour chart
While this outlook seems promising, Cardano price moves at the whim of Bitcoin price volatility. Therefore, a daily candlestick close below the equal lows at $0.425 could turn sour if ADA fails to recover above it. Moreover, a secondary confirmation of the lack of bullish strength will be seen if the altcoin fails to move above the $0.435 resistance level.
Such a development will invalidate the bullish outlook for Cardano price and potentially trigger a 10% crash to $0.380.
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
Polygon joins forces with WSPN to expand stablecoin adoption
WSPN, a stablecoin infrastructure company based in Singapore, has teamed up with Polygon Labs to make its stablecoin, WUSD, more useful in payment and decentralized finance.
Coinbase envisages listing of more meme coins amid regulatory optimism
Donald Trump's expected return to the White House creates excitement in the cryptocurrency sector, especially at Coinbase, the largest US-based crypto exchange. The platform is optimistic that the new administration will focus on regulatory clarity, which could lead to more token listings, including popular meme coins.
Cardano's ADA leaps to 2.5-year high of 90 cents as whale holdings exceed $12B
As Bitcoin (BTC) gets closer to the $100,000 mark for the first time — it crossed $99,000 earlier Friday — capital is rotating into alternative cryptocurrencies, creating a buzz in the broader crypto market.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: Rally expected to continue as BTC nears $100K
Bitcoin (BTC) reached a new all-time high of $99,419, just inches away from the $100K milestone and has rallied over 9% so far this week. This bullish momentum was supported by the rising Bitcoin spot Exchange Traded Funds (ETF), which accounted for over $2.8 billion inflow until Thursday. BlackRock and Grayscale’s recent launch of the Bitcoin ETF options also fueled the rally this week.
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.