Cardano (ADA) price has fallen by 18% in the past week, with technical factors such as the Death Cross and negative Ichimoku Cloud indicators reinforcing the downtrend. However, the ADX index, although strong, is signaling that the downtrend is starting to slow down. In the short term, ADA is expected to hold the 0.78% support and the 0.99% and 1% resistance levels are expected to give recovery signals.$ADA
Cardano’s price has lost 18% over the past seven days, but it remains among the top 10 cryptocurrencies by market cap. This decline has been supported by the death cross of the EMA lines and the negative indicators in the Ichimoku Cloud. However, some technical indicators are showing signs that ADA’s downward momentum may be slowing down. Notably, ADA’s ADX has shown a slight decline after peaking at the beginning of the week.
The Average Directional Index (ADX) is currently trading at 27.5. This indicator, which rose from below 20 on December 19, has shown a slight decrease above 30 in recent days. This signals a shift in strength in Cardano’s current downtrend and that momentum is weakening slightly. Typically, an ADX above 25 indicates a strong trend, while a slight decrease indicates that the current trend is weakening but still significant.
In the short term, this could allow selling pressure to ease and the ADA price to consolidate or attempt a small recovery. This will depend on whether buying activity picks up or not.
ADA’s Ichimoku Cloud is showing a bearish trend. The price is trading below the cloud, indicating continued bearish momentum. The blue conversion line (Tenkan-sen) remains below the red baseline (Kijun-sen), confirming that the market is bearish. However, the narrowing between these lines suggests that there may be a slowdown in bearish momentum if the price becomes more stable.
The lagging line (Chikou Span) is below both the price and the cloud, highlighting the continuation of the downtrend. The forward cloud (Kumo) also indicates continued downward pressure, limiting the possibility of a significant trend reversal for ADA in the short term.
Cardano’s EMA lines formed a death cross on December 20, indicating that bearish momentum is strengthening as the short-term EMA has crossed below the long-term EMA. If this downtrend continues, the ADA price could drop to $0.78 levels. If this support level is broken, the ADA price could drop to $0.65 or even $0.519, which would mark a 42% correction from current levels.
However, if the market trend reverses and bullish momentum builds, ADA could move towards the $0.99 and $1.039 resistance levels. A break of these levels could indicate stronger buying interest and could potentially push the ADA price to $1.18. This would imply a 31% increase from current levels.