Cardano is showing signs of forming a double bottom, which might mean it’s ready for a bull run to challenge the overhead trendline. This raises the question: will this rally push Cardano to $1?
Cardano has been losing value for months, dropping 54% from $0.81 in April to $0.37, after facing resistance at $1. It’s trapped in a declining triangle pattern with support at $0.34, struggling to break free and move towards the $1 target.
Cardano’s Market Activity and Potential Bullish Reversal
Cardano is currently in a negative cycle, taking support from the baseline at $0.34 in the daily chart. Despite a 13% drop this week, ADA is up by 1.65% today and is trading at $0.370.
With a market cap of $13.34 billion, Cardano is the tenth biggest cryptocurrency. However, Coinglass reports that nearly $2.5 million worth of bullish positions were liquidated over Thursday and Friday.
The lower price rejection in the intraday candle hints at a potential bullish recovery over the weekend. Additionally, the support level at $0.34 has historically provided a cushion for a bounce back.
The daily RSI line shows a bullish divergence, supporting the possibility of a bullish cycle. However, the MACD and signal lines continue to trend bearish, with a rise in negative histograms.
Cardano’s Potential for a Bullish Reversal and Breakout
With a bullish divergence at play, Cardano’s recovery rally is likely to pick up pace next week, increasing the chances of a breakout above the overhead trendline.
Using the Fibonacci retracement over the correction run, the 50% Fibonacci level at $0.56 serves as a potential target for a breakout rally. Beyond this, the bullish reversal could complete a rounding bottom reversal with a neckline at the $0.775 peak.
Therefore, a bull run appears likely for Cardano as the market recovers. However, the uptrend may not reach the $1 mark this quarter. According to the same Fibonacci retracement, the 1.618 Fib level at $1.041 is a potential target for this year.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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