Cardano is still facing down after recording more than 20% loss in three weeks. However, it appears bearish exhaustion may set in as the price nears crucial support. It is likely to bounce back if the support hold.
In April, Cardano’s price soared to an eight-month high at $0.46 following a steady one-month rally. After testing that level, the price fell and began to correct lower until it reached $0.37.
The price bounced off that level for three days and encountered resistance. It initiated another sell and extend the bearish correction to $0.35 on Monday – making it the lowest price in the past month.
As much anticipated, the price has finally reached an expected buying area. Aside from that, the correction brought trading near the lower boundary of the ascending channel, as shown on the daily chart. A rebound should be expected anytime soon.
Meanwhile, the Monday low provided support and continued to hold. The bears are attempting to extend pressure with the current daily drop.
Because of that, the channel’s lower boundary remains a crucial line for the bulls. If the price flips through it, Cardan could drop as low as $0.25 before it regains momentum. Of course, a strong rebound above the lower boundary should produce a fresh increase.
Cardano’s Key Levels to Watch
From a technical standpoint, the expected setup from here is a rebound. If that occurs, ADA would need to retake the $0.376 resistance level, followed by the key $0.4 resistance level. Above these levels lie $0.42 and $0.44 before testing the $0.463 level for a breakout.
Fundamentally, ADA may sustain bearish sentiments below the channel. The close support level to keep an eye on is $0.34. The next support levels are $0.323 and $0.3.
Key Resistance Levels: $0.376, $0.4, $0.42
Key Support Levels: $0.34, $0.323, $0.3
- Spot Price: $0.36
- Trend: Bearish
- Volatility: High
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any projects.
Image Source: Photo by Traxer on Unsplash // Image Effects by Colorcinch
