Short-Term Support for Cardano Found at $0.39
Cardano’s price experienced rapid growth in the previous week, with a notable 20% increase between September 23 and 27, coming close to testing the resistance level of $0.418. Technical indicators reflected a bullish sentiment.
There were indications of a potential significant rally on the horizon, as the rise in active addresses suggested a surge in organic demand. However, the decline in Bitcoin from the $66k resistance level had a negative impact on Cardano’s price.
While the long-term price projection for Cardano remained optimistic, the inability to recapture the nearby retracement level raised concerns about future developments.
Momentary Pause in Range Breakout
Following the downward price movement in July and early August, a series of Fibonacci retracement levels were established.
It became evident that the 78.6% retracement level at $0.418 holds significance for Cardano bulls to reclaim in order to shift the long-term trend in a bullish direction.
Meanwhile, a price range between $0.312 and $0.393 took shape over the last couple of months. The optimism in the market last week pushed ADA above the range’s upper boundaries, although it did not surpass the Fib retracement level at $0.418.
Despite a recent 7% drop in price over the past three days, the Chaikin Money Flow (CMF) remained above +0.05, indicating substantial capital inflow. Furthermore, the daily Relative Strength Index (RSI) signaled ongoing bullish momentum.
As a result, it seems plausible that the $0.387 mark could provide short-term support before the next upward movement.
Looking Ahead for Cardano Post $0.39 Liquidity Sweep
An extensive pool of liquidity was detected around the $0.39 level, which Cardano absorbed during recent trading hours. This absorption suggests a potential bullish reversal, with the price expected to advance towards the $0.408 range.
However, the current short-term bearish momentum surrounding Bitcoin might exert downward pressure on Cardano in the coming week.
Therefore, traders are advised to exercise caution and strategize for a potential retreat from the range’s upper boundaries.
Disclaimer: The opinions stated in this write-up do not constitute financial, investment, trading, or any other form of advice but rather reflect the author’s personal perspective.