Cardano's price successfully released from a bullish cup-with-handle support pattern on May 5, kickstarting a rally through the longstanding trading range highs while setting ADA new all-time highs in the process. Historical precedent suggests that ADA price has further to rally moving forward.
During March and April, Polygon's price moved in a well-defined 50% trading range before unleashing a furious 100% rally over five days. As a result, Polygon's price was one of the first cryptocurrencies to print an all-time high following the cryptocurrency correction in April.
On May 5, Cardano's price began a new rally from a similar trading range as Polygon's price, presenting a bullish investment opportunity for traders.
Since the breakout originated from a cup-with-handle pattern base, the measured move target is $2.19, a gain of 55% from the handle high and 29% from the ADA price at the time of writing. The target fits perfectly with the 161.8% Fibonacci extension of the cup-with-handle pattern at a price of $2.17, and the trading range measured a moving target of $2.23. It is a 50% return from the range’s upper boundary.
Cardano ADA price will need to overcome resistance at $1.91, the 138.2% extension support level, and the psychologically important $2.00 to reach the target prices.
Of course, Cardano's price could fail and revert lower. The first necessary support level is the 10-week simple moving average at a price of $1.24 and then the midline of the trading range at $1.21.
To advance the bullish outlook, the ADA/BTC graph illustrates a cup-completion-cheat pattern, offering early entry into the shift in Cardano ADA price relative strength. A cup-completion-cheat is a pattern that forms following a break pattern in the downtrend and in the lower third of the eventual cup.
A breakout from this pattern would further confirm that Cardano's price is in the early stages of an explosive move.
The historical precedent of polygon MATIC, combined with the power of the new rally and the almost-perfect base for ADA/BTC pair, creates an extraordinary opportunity for traders in the coming weeks.
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