Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice
Cardano’s price has benefited greatly from Bitcoin’s bull run. Over the past week, the cryptocurrency’s price saw a whopping 88 percent hike. Even in the short-term, i.e. in the past 24-hours, such strong bullish sentiment was evident, one that propelled the cryptocurrency’s price to its press time valuation. However, taking a look at Cardano’s price action suggested that a correction seemed imminent.
At press time, ADA was trading at $0.319, with the crypto having a market capitalization of close to $10.5 billion. With the price of the coin rising by over 17 percent in a day’s time, ADA also registered a 24-hour trading volume of $6.7 billion, according to CoinMarketCap.
Cardano 1-hour chart
Source: ADA/USD, TradingView
According to Cardano’s 1-hour price chart, a price correction seemed to be already in the works. The past few trading sessions saw red candles and the price seemed to have failed to breach the resistance at $0.34 too.
While the cryptocurrency had found a bit of support around its press time trading price, a further decline in price would send ADA’s valuation all the way down to its clear support at $0.28. In the short-term, unless there is immense bearish pressure, it is unlikely that ADA will need the assistance of its second support level at $0.22.
The dip in ADA’s price over the last few hours seemed to be in accordance with what its technical indicators were highlighting. The RSI fell steadily on the charts, moving away from the overbought zone. In fact, at press time, it was heading closer to the neutral zone, highlighting a clear dip in bullish sentiment for the coin. The MACD indicator also looked bearish as its signal line had gone past the MACD line, forming a bearish crossover.
Support: $0.28, $0.22
Take Profit: $0.29
Stop Loss: $0.33
After having posted significant gains on the charts, Cardano’s price seemed to be undergoing a minor correction after having failed to overcome its immediate resistance at $0.342. This may end with ADA’s price dropping to its immediate support in the short-term, with this possibility backed up also by its technical indicators.