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A cryptocurrency analyst has confirmed the recent breakdown of the Cardano price from an Ascending Channel pattern. With key support and resistance levels now in focus, the analyst has outlined two scenarios for ADA, projecting where its price could move next.
Cardano Price Ascending Channel: Bullish Scenario
The Cardano price has been trending within an Ascending Channel for some time, maintaining steady price momentum amidst market volatility. However, a TradingView crypto analyst, known as ‘MelikaTrader94’, has identified a recent change in the Cardano price action. The analyst highlights that the altcoin has broken below the Ascending Channel, indicating a possible shift in market sentiment.
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An Ascending Channel is a distinctive chart pattern formed by two upward-sloping parallel trend lines. This pattern is typically considered a bullish continuation signal, often indicating the potential for a price reversal or deeper correction.
Based on the TradingView analyst’s report, Cardano’s recent breakdown from its Ascending Channel could give rise to two possible scenarios. Firstly, the analyst predicts that the price of Cardano could experience a bullish surge, driven by the momentum generated from the channel breakdown.
The analyst shared key support and resistance levels to watch, highlighting that a breakout above resistance could confirm a bullish reversal. Interestingly, the Cardano price has already broken below the key support level of around $0.7765. The cryptocurrency is now testing lower regions to find its next critical support.
The TradingView analyst predicts that if the price of ADA can reclaim the support level at $0.7765, a retest to higher levels may be imminent. He has set a bullish target for ADA between $0.95 and $1.00, signaling the start of a strong uptrend and a potential price discovery. He also highlighted new resistance levels between $0.7765 and $0.80 for the price.
Bearish Scenario: Further Decline Toward 0.2910 Fib?
In an alternative scenario, MelikaTrader94 has shared a bearish outlook for the Cardano price. The price of Cardano is already in a severe downturn after crashing by 23.3% over the past week. Despite this bearish performance, the TradingView analyst predicts that ADA could see further downward momentum, declining towards the 0.4836 and 0.2910 Fibonacci levels if it fails to hold current levels.
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The TradingView expert has pinpointed new support levels around $0.63, $0.48, and $0.29. These price points act as a barrier for ADA, potentially preventing further declines. The analyst also disclosed that these support levels will serve as significant demand zones where buying pressure is set to increase.
Given the possibility of a further breakdown in ADA’s price, the analyst has cautioned investors to closely monitor ADA’s price action, particularly around the $0.63 level, as this could confirm the cryptocurrency’s next move.
Featured image from Adobe Stock, chart from Tradingview.com