Bullish Pennant Pattern Could Boost Cardano Price
ADA, the native token of the Cardano ecosystem, has experienced a recent rebound and is currently trading at $0.51. The altcoin has seen a 12% surge in price and is encountering supply pressure at the resistance trendline of a pennant pattern. This chart pattern has the potential to support sustainable growth in Cardano’s price.
The End of Correction Trend and Resistance Levels
- The breakout of the flag pattern would signal the end of the correction trend in ADA.
- Significant resistance levels for ADA’s recovery path are $0.543 and $0.62.
- The intraday trading volume for ADA is $286.3 million, indicating a 35% loss.
In December, the Cardano (ADA) coin entered a new correction trend after reaching a resistance of $0.677. This resulted in a significant drop, with the altcoin losing over 33% of its value and touching a low of $0.447 at the 50% Fibonacci retracement level.
On the daily chart, there are converging trend lines that form a pennant pattern. This suggests a temporary pullback in ADA’s price, potentially leading to a resurgence in bullish momentum.
In recent trading hours, ADA has seen a 1% increase, indicating a potential bullish breakout from the resistance trendline of the pennant pattern. If confirmed, this breakout could pave the way for a new recovery trend, with targets at $0.62 and $0.675.
However, there is ongoing resistance from sellers at the descending trendline, as indicated by the long wick on the daily candle. This could lead to another reversal and extend ADA’s bearish trend.
Technical Indicators
- Relative Strength Index: The daily RSI slope moving flat at the midline reflects a neutral sentiment in the market.
- Bollinger Band: The shortening range between the Bollinger band boundaries indicates rising market volatility.
Hot Take: Cardano’s Bullish Potential
Cardano’s price has rebounded and is currently facing resistance at the trendline of a pennant pattern. A breakout from this pattern could signal the end of the correction trend and potentially lead to a new recovery trend. However, ongoing resistance from sellers may result in another reversal. Technical indicators show a neutral sentiment in the market and rising volatility. Overall, Cardano’s price movement remains uncertain, but it holds bullish potential if certain levels are surpassed.
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