In light of the correction over the past 7 days, Cardano's price trend continues to stagnate below the $1 mark. This pullback has played out across the entire crypto industry, causing Cardano to drop below the $1 mark again on December 18.
Although the broader trend suggests that the weekly time frame may be moving toward a new all-time high (ATH), recent technical analysis from TradingView provides the possibility of a continued pullback to $0.43 before another strong upward move.
The current price trend highlights resistance levels and cooling periods.
According to technical analysis of Cardano (ADA) price trends on the weekly candlestick time frame, the cryptocurrency has encountered significant resistance near the $1.2046 mark. This resistance level emerged after Cardano surged 205% from $0.4322 in late October to $1.32 in late November.
Interestingly, this significant price surge has led Cardano to form a notable low as a support level for the price. Moreover, the rebound eventually culminated in Cardano entering the overbought area of the Relative Strength Index (RSI) indicator. The rebound ultimately resulted in Cardano's price peaking at 82.87 on the RSI, but subsequently retraced to a cooling/correction period, with buying pressure consolidating at the time of writing.
The consolidation of Cardano has opened up prospects for its next developmental direction, with a significant amount of buying volume observed in the recent trading days.
A deep correction may test the key support level of $0.43.
While the long-term outlook remains bullish, the analysis highlights the possibility of a deep correction, which could lead to a further decline in Cardano's price in the short term. With this in mind, analysts point out that if a deeper correction occurs, ADA may revisit the support level. The first key level of $0.7683 has already proven its importance, acting as a retracement area in the recent price movements.
Below this, $0.4322 is the current final support level for the bullish leg. This means that ADA must stay above the support level of $0.43 to keep the bullish trajectory valid. Failing to hold above $0.43 may lead to further price declines at this time and shift to a bearish outlook.
Analysts have also identified $0.3166 and $0.2427 as major support levels. These levels are the lowest support points for Cardano during the previous bear market and are considered unlikely to be breached in the event of a prolonged downturn.
Despite the possibility of a deep correction, Cardano's recent market behavior and buying trends indicate a bright long-term outlook. At the time of writing, ADA is trading at $0.912, up 2% in the last 24 hours. Once the current resistance level of $1.2046 is cleared, ADA will be fully capable of challenging its all-time high of $3.09 and possibly setting a new high in the current cycle.
