-Price has been supported by 60MA
-ADA has now formed an ascending channel
Cardano has been one of the best performing crypto assets in the top 10 cryptocurrencies by market cap. Since the low of $0.017 was set in March of 2020, ADA is up nearly 14,000%. This is very impressive for a project that has yet to fully release the capabilities of its blockchain. On September 12th, Cardano is set to release its “Alonzo” upgrade which fully supports smart contract capabilities. Investors are buying up ADA in anticipation of a successful launch as Cardano will now be a competitor to Ethereum .
Over the last 2 days, ADA fully broke out of its bull flag formation & has went on to touch its previous ATH . Since this move, ADA has shown a newly formed pattern. This pattern is the ascending channel shown in blue, which often holds price together until either trend line is broken. Based on this channel, ADA may be starting a slight retrace before a possible breach of its ATH . For a new high to be set, ADA must break & hold the major resistance zone found at $2.44-$2.50. If bulls manage to pull this off, we should expect a push to the first target of $2.69, at minimum.
Based on the usual price action of a channel, ADA just got rejected at the top trend of its channel which should indicate a retrace is upon us. If bulls fail to break the next resistance zone , we should expect a retracement to at minimum the minor support found at $2.30. If this area fails to hold, we can expect a sweep to the major support zone found from $2.14-$2.24. This would be a healthy scenario and would leave ADA much support beneath. The 60MA has held ADA for weeks & as along as price is above it, ADA is bullish . Breaking below this MA or the bottom trend of channel would be a bearish scenario.
While looking at the Stochastic RSI , we can see how it’s been curling over within the overbought territory. This should indicate a pullback is coming for ADA. If strength breaks below the dotted line, we then should expect the retracement to occur. The regular RSI has printed a bearish divergence which indicates strength is lower on this push than it was a few days ago. If ADA fails to break & hold its major resistance zone , expect the divergence to play out with ADA falling to given support levels. ADA Intraday Analysis
Spot rate: $2.69
Trend: Bullish
Volatility: High
Support: $2.30
Resistance: $2.44
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