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Due to the falling cryptocurrency market conditions, Cardano’s (ADA) price increase may not achieve the goal of reclaiming $0.50 as a support base. However, if investors show optimism, there is still a chance to reverse the downward trend.
Cardano’s Upward Momentum
Like other cryptocurrencies, Cardano’s price also rose, but unlike other altcoins, ADA’s rise may be halted before reaching the fundamental price level. The reason behind this is shown as the saturation of the rise in the case of Cardano. According to the Relative Strength Index (RSI), ADA is in the overbought zone. RSI acts as a momentum oscillator that measures the speed and change of price movements. It ranges from 0 to 100 and is typically used to identify overbought or oversold conditions in a market.
Given that Cardano’s price is above the threshold, it may potentially face the danger of being overbought. Historically, this scenario has been followed by corrections where ADA recorded significant declines. This time, the result could be the same for the altcoin. However, ADA holders have the power to change the mentioned outcome. They need to show more optimism. Due to the recent decline, Cardano investors have faced several challenges.
Technical Analysis of Cardano
This situation can be seen in the total number of transactions conducted on the network in the past few weeks. Less participation leads to lower liquidity, which can keep the price in a horizontal range or in decline. Therefore, as investors’ behaviors change, the direction of ADA’s price can also change. At the time of writing, Cardano’s price is trading at $0.48 and has surpassed the resistance at $0.46. Secondly, an important point is that the altcoin is consolidating, and a breakout from this could raise hopes of climbing to $0.50.
In cryptocurrency, $0.50 is a very important psychological support base, but ADA may not reach this level. The above-mentioned conditions could send ADA back into consolidation, indicating a potential drop to $0.46 or below. However, if ADA holders show an upward trend, the price increase could continue or bounce off the $0.46 support. This could invalidate the bearish thesis and increase gains.
