The price of Cardano has been on a bearish trajectory for the past few weeks. However, recent trading sessions saw bullish attempts as buyers tried to push the price higher. Unfortunately, selling pressure rebounded, causing Cardano to trade near its crucial support level.
The technical outlook for ADA is bearish. The demand and accumulation indicators on the chart have declined in value, indicating a lack of buying interest in the market.
In addition, broader market strength remains uncertain as Bitcoin has recently dipped below the $27,000 price zone in the recent past. This has led to many major altcoins, including Cardano, being rejected at their immediate resistance levels.
Currently, Cardano is at a critical price point. If it manages to break above the overhead resistance, it could trigger a recovery for the coin. However, if the price falls from its current level, it would struggle to hold itself above the crucial support, potentially leading to bearish dominance.
If Bitcoin trades above $27,000, it could positively impact Cardano’s price and potentially lead to a recovery.
For a significant price turnaround, however, it is essential that buying confidence returns to the market. The fall in Cardano’s market cap indicates that sellers have dominated the market.
Cardano Price Analysis: One Day Chart
At the time of writing, Cardano (ADA) was priced at $0.367. In the past 24 hours, ADA experienced a 1.3% price drop, while there was no significant movement on the weekly chart. The main resistance level for ADA is at $0.37, which has proven to be a strong barrier that the bulls have failed to break through in recent weeks.
If ADA crosses the $0.37 resistance, it could reach $0.39, resulting in a significant price increase. However, if the price falls from its current level, it could fall below the crucial $0.35 support line, which the bulls have been defending so far.
ADA’s trading volume in the last session was in the red, indicating a decrease in the number of buyers participating in the market.
Technical analysis
Throughout the month, ADA has shown weak purchasing power. This is evidenced by the Relative Strength Index (RSI) remaining below 40, indicating a predominance of selling power rather than buying power. However, if ADA exceeds its immediate price cap, it could lead to a recovery in purchasing power.
Moreover, ADA has also dropped below the 20-Simple Moving Average (SMA) line, further confirming that sellers have been driving price momentum in the market.
Contrary to previous observations, ADA showed buy signals on the one-day chart. The Awesome Oscillator, which indicates momentum and trend reversal, showed green histograms associated with buy signals. This suggests a possible price increase in the coming trading sessions.
The Bollinger Bands, which represent price swings and volatility, were also parallel and broad. This indicates a higher probability of price fluctuations.
Featured image from UnSplash, charts from TradingView.com