Cardano price void leaves ADA on the brink of a 25% drop
- Cardano price on pace to close with the largest down day since May 21.
- ADA trading well below the 2018 high of $1.40 and may close at the lowest level since April 26.
- IOG Director of Operations hints at a new government partnership in Africa relating to payments and open finance.
Cardano price had successfully held the 2018 high from May 24 until Saturday’s close below $1.40. Today’s weakness has confirmed the breakdown, and ADA may be beginning a larger decline that could involve a test of the psychologically important $1.00 or even a sweep of the May 19 low of $0.91.
Cardano continues to pursue African partnerships
At the end of April, Cardano developers Input-Output Global (IOG) announced important partnership agreements with the Ethiopian and Tanzanian governments. In the Tanzanian deal, the focus is to build scalable infrastructure together with World Mobile. The objective is to provide mobile internet access to the nation while also offering digital identity to be the basis for economic development.
Earlier this month, John O’Conner, the Director of Operations, tweeted about bringing 1 million more users to the Cardano platform.
Today I wrote a letter to a president, found a million users to bring onto #Cardano, and had a damned good cup of coffee. It’s only midday, looking forwards to the afternoon. ♥️ being a part of the @InputOutputHK gang.
— John O’Connor (@jjtoconnor) June 9, 2021
However, in an interview this weekend, he would not provide any details on the potential project, saying that it would not be productive for him to put more pressure on his shoulders by giving away details before signing the contracts.
O’Connor did state that the deal was in the early stages, with the functional part still in research.
A lot of my deal flow is around trying to make sure we that we understand these setters and these industries by working with top-tier marque partners who we can do a pilot with, learn the ropes, learn what’s missing from the Cardano solution at the moment and bake it in.
O’Connor was light on details, but his confirmation of a new deal in the planning stage does capitalize on the early momentum of Cardano in building its blockchain footprint in Africa. For now, Cardano followers need to stay attuned to the news roll to get more insight into the project and which country it involves.
Cardano price unable to silence the catastrophic voices in the crypto market
Cardano price is down approximately 26% from the initial test of the union of the anchored volume-weighted average price (anchored VWAP) and the 50-day simple moving average (SMA) on June 13. It was the first sign that price progress would be a challenge and that the underwhelming commitment, as demonstrated by the volume profile, would need to change.
With Cardano price now comfortably below the 2018 high of $1.40, market speculators need to entertain a deeper decline to the psychologically important $1.00 or a sweep of the May 19 low of $0.91, representing a 26% loss from the current price. To reach the May 19 low, ADA would need to bust the May 23 low at $1.04 and the 200-day SMA at $0.98.
If the Cardano price decline continues, it is anticipated that it will be quick, like on May 19 and to a lesser extent on May 23.
ADA/USD daily chart
An event or news item directly related to ADA could arrest the decline. Potentially, more details about the Africa project mentioned above. Nonetheless, Cardano price would not be actionable until at least a daily close above $1.40. Take note of the failed breakout attempts at $1.40 in February, March and April. As shown regularly, support becomes resistance and heavy resistance if the support period was prolonged.
ADA investors should be monitoring for an oversold reading on the daily Relative Strength Index (RSI) on further Cardano price weakness. The last one was at the September 2020 low, the beginning of a 3,200% advance.
Cardano price sits in a vulnerable position with no overhead resistance to serve as a magnet or recognizable support level until $1.04. ADA market operators would be more successful in letting the digital asset prove itself by flushing down to the key supports or reclaiming $1.40 before engaging it from the long side.