- Cardano converted into a bull market on its $0.01/3-box reversal Point and Figure chart.
- Significant upside potential ahead, even beyond the initial target of $1.33.
- Downside risks could be significant if bulls fail to capitalize on the present structure.
Cardano price action has developed two possible trade setups for the long and short side of the market. The most likely of the two to occur is the potential long entry, but the short entry could trigger a more damaging and drawn-out setup.
Cardano price action shows two excellent trading opportunities on the Point and Figure chart
Cardano price has a theoretical long entry opportunity with a buy stop order at $1.19, a stop loss at $1.15, and a profit target at $1.33. The setup is based on the re-entry long after the first pullback from converting into a bull market. On Saturday, Cardano recently broke the bear market trendline when ADA moved to $1.20.
ADA/USD $0.01/3-box Reversal Point and Figure Chart
The theoretical long setup represents a 3.5:1 reward for the risk. A two-box trailing stop would help protect any profit made post entry. The long idea is invalidated if the Cardano price moves to $1.13 before the triggered entry.
On the sell-side of the trade, the hypothetical short setup is a sell stop entry at $1.08, a stop loss at $1.14, and a profit target at $0.90. The trade represents a 3:1 reward for the risk with an implied profit target of 16% from the entry. A two-box trailing stop would help protect against whipsaw generated if Cardano price approached the $1.00 value area again.
ADA/USD $0.02/3-box Reversal Point and Figure Chart
The hypothetical short setup for Cardano price is invalidated if the current X column returns to $1.24.
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