Cardano Prices Show High Volatility in Recent Weeks
The price of Cardano has recently experienced significant volatility, with the altcoin initially rising from $0.37 but later being rejected at $0.45. While there has been a slight 1.3% increase in the last 24 hours, the weekly chart indicates a price increase of 6.2%.
Technical analysis of ADA indicates that bulls are attempting to take control of the price, with demand and accumulation showing signs of recovery. Despite the slow development of the ADA price, there is a critical resistance level that must be exceeded to trigger a rally. For the bulls to continue gaining momentum, buying power must significantly increase in the coming trading sessions.
Furthermore, major altcoins have stagnated due to the difficulty of Bitcoin reaching $30,000. If BTC regains that level, it could drive ADA bulls to push the price higher in subsequent trading sessions. Additionally, the market capitalization of ADA has recovered, indicating that buying pressure is returning to the market.
Cardano Price Analysis: One-Day Chart
At the time of writing, ADA was trading at $0.40, with overhead resistance at $0.42. This level has proven to be a significant obstacle for Cardano in the past, and multiple attempts to break through it have been unsuccessful. However, if ADA manages to move above this resistance level, it could trigger a rally and push the price towards $0.46.
Alternatively, if the price falls from its current level, the support level is at $0.39. If ADA fails to stay above this support level, it could lead to a price decline to $0.36. The amount of ADA traded in the last session was green, indicating an influx of buyers.
Technical Analysis
While demand for ADA has increased slightly, buying power on the daily chart has declined slightly. The Relative Strength Index remains above the halfway line, indicating that buyers are still in control of the market. However, Cardano's movement below the 20-day moving average line suggests that sellers may soon take over if demand is insufficient. This reading implies that sellers are driving price dynamics in the market.
ADA formed sell signals in line with other indicators. The Moving Average Convergence Divergence showed red histograms below the halfway line, indicating a sell signal based on price dynamics and reversals. The Directional Movement Index was negative, indicating negative price momentum, with the -DI line (orange) above the +DI line (blue). The Average Directional Index (red) approached 20, suggesting that the current price action lacked strength.
Featured image from Unsplash, Charts by TradingView.com
