2021-05-04 03:00:00

ADA eyes 20% gains amid sell-off

  • Cardano price slid nearly 8% as the crypto market collectively witnessed a minor market crash.
  • The recent sell-off has allowed ADA to tap a confluence of support around $1.26, increasing its upswing probabilities.
  • A 20% run-up to $1.54 seems likely if sidelined investors begin to pour in.

Cardano price has been on a steady upswing over the past week but faces a tiny retracement today. A bounce from the immediate support barrier seems likely.

Cardano price aims to come back stronger

On the 4-hour chart, Cardano price has sliced through the 50 four-hour Simple Moving Average (SMA) at $1.31 and tested the confluence of 100 and 200 SMAs at roughly $1.26. Interestingly, this point is just above a crucial demand zone that stretches from $1.19 to $1.25.

This crash has restarted the Momentum Reversal indicator (MRI) count and prevented the formation of a cycle top. Additionally, the quick bounce shows that buyers are ready to purchase ADA at a discount.

Therefore, investors can expect a quick 15% upswing in Cardano price toward $1.44, coinciding with the 162% Fibonacci extension level or a 20% run-up to $1.52.

Beyond $1.52, if the bullish momentum persists, market participants can expect a retest of the all-time high at $1.55 and a leg up to new record levels.

ADA/USDT 4-hour chart

On the flip side, if the sell-off continues, Cardano price could most likely enter the aforementioned demand zone. A breakdown of the range low at $1.13 and extended trading below this level will most likely invalidate the bullish thesis.

However, as long as ADA stays inside the next area of support ranging from $1.14 to $1.01, it still has a chance at recovery, no matter how slim.

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