Published 2 mins ago
Amid the V-shaped recovery in the daily time frame chart, the Cardano coin price shows the formation of a falling wedge pattern. This chart structure is characterized by two converging trendlines that form a wedge shape and lead a temporary rally in an asset. Thus, in core concept, this pattern in some of the famous bearish continuation structures signals an upcoming downfall.
Key Points:
- A potential pullback may plunge the coin price to $0.35 support, followed by $0.323
- A minor correction phase could recuperate the bullish momentum for a sustained recovery in the long term
- The intraday trading volume in the ADA coin is $275.4 Billion, indicating a 24% gain.
Source- Tradingview
In theory, as the trendlines converge during the wedge pattern formation, the price action becomes more confined, indicating a potential trend reversal from bullish to bearish. Typically, this pattern is confirmed when the price breaks below the lower trendline, signaling a trend reversal and a potential sell signal for traders.
By press time, the Cardano coin price trades at $0.394 with an intraday gain of 0.5%. However, on February 6th, the coin price breached the lower trendline, with a daily candle closing below it.
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This breakdown will intensify the selling pressure and trigger a significant downfall in ADA price. The post-breakdown fall could rumble the price 18% lower to hit the $0.323 mark. However, this potential correction can be considered a temporary retracement to replenish the bullish momentum.
However, the ADA price sustainability above $0.323 is important to maintain an overall bullish trend.
Technical Indicator.
Relative strength index: contrary to the rising price action, the falling RSI slope projects the exhausted bullish momentum. This bearish divergence bolsters the possibility of a bearish pullback.
EMA’s: the 20-day EMA dynamic support may assist buyers in undermining the correction theory.
Cardano Coin Price Intraday Levels
- Spot price: $0.384
- Trend: Bullish
- Volatility: Medium
- Resistance level- $0.438 and $0.522
- Support level- $0.382 and $0.323
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
