Cardano’s price action is currently at a critical juncture, with liquidity concentrated at $1.0, which could significantly impact price action in the future.
Cardano, which recorded a strong 200% rally in November, entered a consolidation period afterwards, but analysts are optimistic about a possible jump towards the $1.5 level.
“The bullish ascending triangle on the 4-hour chart signals the possibility of further upside if market conditions remain favorable,” a COINOTAG analyst wrote.
This article evaluates Cardano’s current consolidation phase, focusing on possible price movements and bullish indicators as it approaches key liquidity zones.
ADA’s $1.5 Target
Cardano (ADA) is currently displaying a notable bullish ascending triangle formation on its 4-hour chart. After an impressive 200% surge in November, ADA is currently in a consolidation phase, with many traders expecting the price to head towards the $1.5 level. A breakout of this triangle pattern could trigger a significant price move and send ADA to $1.45, potentially representing a gain of around 25%.
Technical indicators, particularly the Chaikin Money Flow (CMF) and On Balance Volume (OBV), are at above-average levels, suggesting that bullish momentum could continue as ADA eyes a target of $1.5. However, a drop below the triangle’s support line could undermine this scenario and lead to pullbacks towards the $0.9 support level.
Analysis indicates that large long positions are accumulating at $1.0 and there is a significant liquidity pool of partial sellers at $1.2 and above. These liquidity zones play a critical role in determining price action by market makers.
In this environment, it means that ADA could fall to $1.0, but if it makes a strong bounce, it could gain upward momentum and surpass $1.2. However, if ADA falls below $1.0, it could negatively impact market sentiment and signal a rethink of trading strategies.