The central theses
- Cardano has reached a tipping point as volatility prepares for a setback.
- As long as the $ 1.10 support continues, the chances of a rebound to nearly $ 2.00 remain high.
- If ADA does not exceed this price hurdle, a correction to USD 0.88 can occur.
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Cardano has gone through a five-day period of stagnation with no clear sign of where the price is going next. Now that ADA is at crucial support levels, a surge in demand is all it takes to march to new all-time highs.
Cardano prepared for higher altitudes
Cardano’s price promotion was included in an ascending parallel channel last month.
Every time ADA has risen to the top of this technical formation since early February, it is rejected and reverts to the bottom. At this point it tends to recover, which is consistent with the characteristics of a channel.
After the station’s recent re-test of the lower trendline, Cardano could be set for a bullish impulse towards the middle or upper trendline, as it has for the past few weeks.
These areas of interest are $ 1.50 and $ 1.90, respectively.
ADA / USD on TradingView
As long as the underlying support at $ 1.10 continues, the chances of a rebound to new all-time highs remain intact.
Strong support without resistance
IntoTheBlock’s IOMAP (In / Out of the Money Around Price) model shows that it would take Cardano a significant number of sell orders to break the $ 1.10 support. Based on this on-chain metric, almost 140,000 addresses had previously bought around 5 billion ADA at this price level.
Such a critical lock on demand is likely to absorb any downward pressure. Owners in this area could do whatever they can to prevent their investments from “going out of money”. You can even buy more tokens to counter the selling pressure.
In / Out of the money at the price of IntoTheBlock
Given the importance of the $ 1.10 support level, just a daily candlestick close to that level would invalidate the bullish outlook. If Cardano breaks that price hurdle, it will jump toward the next major area of interest at $ 0.88.
Here the IOMAP cohorts show that 136,000 addresses contain 2.80 billion ADA.
Disclosure: At the time of writing, this author owned Bitcoin and Ethereum.
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