Cardano ADA price climbs leaderboard with a surge in relative strength, providing patient investors with an opportunity to seize upon the ADA bullish attention garnered by Cardano’s lesser carbon-intensive ecosystem. Any consolidation at this point should prove to be temporary.
On a Bitcoin basis, ADA price has emerged convincingly from a cup-completion-cheat pattern level this month after correcting in March and April. Last week, the ADA/BTC pair registered the largest two-week gain since January 2018 and rallied above the 50% retracement level of the massive 2018-2019 decline at $0.00004592.
At last weeks’ high, ADA price registered a similar weekly Relative Strength Index reading that preceded the tops in July 2020 and February of this year. It does recommend some caution, but any price correction in the pair should be delivered through an improvement in BTC price versus a sudden decline in Cardano price.
On May 5, guided by a 16% gain, ADA's price emerged from a cup-with-handle base, establishing a trend change for Cardano following months of consolidation. The initial post-breakout price action was reluctant, but the profile of the daily trade volume remained unwavering, showing no signs of distribution. The awkward ADA price action was soon reconciled with a powerful, bullish engulfing day on May 13, covering the previous six trading days and closing with a 23% gain.
Cardano's price would extend the breakout from the cup-with-handle pattern base to the measured move target of $2.40, representing a 65% price gain from the handle breakout at $1.46. On May 15, Cardano's price reached a high of $2.46 while overcoming the resistance level of the 161.8% Fibonacci extension of the April correction at $2.23.
Cardano's price stumbled yesterday, but price momentum still favors higher prices moving forward. The path could be a slow, staggered advance or, if the Cardano complex sentiment improves, a blow-off type of move, similar to MATIC over the last few days. The blow-off move should carry ADA to the price of $3.00, representing a 50% gain from the price at the time of writing, or even to the 261.8% extension of the April correction at a price of $3.93.
Things can change instantly in the cryptocurrency market, so investors need to be prepared for a bearish scenario. If ADA price has entered a consolidation, it should hold the May 9 high at $1.89 on a daily closing basis. The next viable support level arrives at the confluence of the May 13 low at $1.32, with the 50-day simple moving average around $1.42.
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