On August 3, the price of the leading altcoin Cardano (ADA) unexpectedly dropped below the consolidated support at $0.3 and the support trend line. Despite the expectation that this pressure would trigger a significant correction in the midst of increasing uncertainty, the price moved sideways, reflecting weakness in the downward momentum. Let’s take a closer look at how buyers can benefit from the ongoing consolidation to initiate a new recovery cycle.
Cardano Price Analysis
Sellers in ADA failed to pull the price down despite the recent break of the rising support trend line. The long-tailed rejection candle on the daily timeframe chart indicates that investors are clearly accumulating. ADA, which traded at $0.29 with a 2.82% increase in the last 24 hours, surpassing the support at $0.3 level, will prevent the recent decline from simply being a bear trap.
A bear trap is a situation occasionally seen in financial markets to deceive buyers, forcing them to sell in panic. A potential breakthrough of ADA’s price from the support trend line at $0.3 will be a strong signal for recovery, and from that point on, the price of the altcoin can be expected to rise up to $0.38 with a 26% increase.
Can Buyers Take the Price of ADA Beyond $0.3?
The expected potential rally in ADA’s price will also support the formation of a double bottom pattern on the daily timeframe price chart. This formation often reflects strong accumulation by buyers and typically results in a significant upward movement.
Under all this technical outlook, the prominent target level for the price of the altcoin is $0.46, indicating a potential increase of over 58% at current prices.
On the other hand, the upward movement of the 20, 50, 100, and 200-day Exponential Moving Averages (EMAs) on Cardano’s price chart may create additional obstacles for trading. However, the potential upward crossover between the Directional Movement Indicator’s DI+ (blue) and DI- (orange) slopes will indicate increased buying pressure for the altcoin, providing a positive signal.
