Cardano is showing signs of forming a double bottom, which might mean it’s ready for a bull run to challenge the overhead trendline. This raises the question: will this rally push Cardano to $1?
Cardano has been losing value for months, dropping 54% from $0.81 in April to $0.37, after facing resistance at $1. It’s trapped in a declining triangle pattern with support at $0.34, struggling to break free and move towards the $1 target.
Cardano’s Market Activity and Potential Bullish Reversal
Cardano is currently in a negative cycle, taking support from the baseline at $0.34 in the daily chart. Despite a 13% drop this week, ADA is up by 1.65% today and is trading at $0.370.
With a market cap of $13.34 billion, Cardano is the tenth biggest cryptocurrency. However, Coinglass reports that nearly $2.5 million worth of bullish positions were liquidated over Thursday and Friday.
The lower price rejection in the intraday candle hints at a potential bullish recovery over the weekend. Additionally, the support level at $0.34 has historically provided a cushion for a bounce back.
The daily RSI line shows a bullish divergence, supporting the possibility of a bullish cycle. However, the MACD and signal lines continue to trend bearish, with a rise in negative histograms.
Cardano’s Potential for a Bullish Reversal and Breakout
With a bullish divergence at play, Cardano’s recovery rally is likely to pick up pace next week, increasing the chances of a breakout above the overhead trendline.
Using the Fibonacci retracement over the correction run, the 50% Fibonacci level at $0.56 serves as a potential target for a breakout rally. Beyond this, the bullish reversal could complete a rounding bottom reversal with a neckline at the $0.775 peak.
Therefore, a bull run appears likely for Cardano as the market recovers. However, the uptrend may not reach the $1 mark this quarter. According to the same Fibonacci retracement, the 1.618 Fib level at $1.041 is a potential target for this year.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
⚠️Disclaimer
This content aims to enrich readers with information. Always conduct independent research and use discretionary funds before investing. All buying, selling, and crypto asset investment activities are the responsibility of the reader.
