A widely followed crypto analyst says that the smart contract platform Cardano (ADA) is likely entering a “depression phase” where the price could fall significantly.
In a new strategy session, crypto analyst Benjamin Cowen says tells According to its 786,000 YouTube subscribers, the Ethereum (ETH) competitor is likely to enter a deeper correction period and reach the bottom of the bear market at much lower prices.
Cowen compares ADA to the trends of the Nasdaq in 2002-2003 to show that even after a major price drop and a prolonged bear market, the price can still suddenly drop dramatically further after being rejected from the 50-week moving average.
“From the Bulls last ditch effort during the 50th week [moving average]the [Nasdaq] decreased by 50%. What would that mean for ADA? From this level, $0.37, so not $0.26, which we are right now, but from $0.37 cents, what would a drop from 49% to 50% look like? That would bring the ADA below $0.20.
You could also measure this in other ways. Instead of taking it from there, you could measure it [an even lower low]and that was the penultimate low to the last low, [which] was a decrease of 27%. A 27% drop from this low would mark a decline [ADA] all the way down to $0.16, which also happens to be a somewhat significant level, the one ADA came back to in August 2020.”
While not picking specific targets, Cowen outlines potential levels of $0.17, $0.12 or $0.07 for Cardano to find the bottom.
“There are some other key levels in here as well, you also have that $0.11 level at the 2019 high, and then of course you also have the pre-pandemic high which is very far below which is just around $0 .07 or $0.08. I’ll be the first to tell you that when we get into the depression phase I have no idea how low it goes, absolutely no idea…
So the most important part here is to consider: is this the beginning? Are we about to enter the depression phase? We just had some red weeks in a row we could always come back for a few more weeks to make sure people got into YOLO one last time but there’s a real risk here and I just think people need to be aware of it now.”
i
Don’t miss a single beat – Subscribe to receive email alerts delivered straight to your inbox
Check price action
follow us on Twitter, Facebook And Telegram
Surf to the Daily Hodl mix
Featured image: Shutterstock/Everyonephoto Studio/Andy Chipus