Cardano Price Analysis: What Is Next for ADA After 7% Daily Drop to Below $1?
2024-12-19
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Cardano recently initiated a strong upward rally, reclaiming its yearly high of $0.8 and advancing to the critical $1.3 resistance zone.
However, the market is expected to enter a consolidation phase, with price fluctuations between the $0.8 and $1.3 range.Technical Analysis
By ShayanThe Weekly Chart
Cardano has recently experienced a surge in buying pressure, rallying from the critical $0.3 support zone. This bullish momentum enabled ADA to reclaim its prior yearly high of $0.8 and reach the significant $1.3 resistance level. However, the $1.3 threshold remains a decisive barrier, with sellers exerting considerable influence, leading to a recent rejection.
In the mid-term, ADA will likely undergo a retracement phase, potentially returning to the broken $0.8 level before resuming its upward trajectory. A successful rebound from this support could set the stage for a renewed rally, targeting the crucial $2 resistance zone and signaling the continuation of a long-term bullish trend.The 4-Hour Chart
On the 4-hour chart, Cardano’s bullish momentum has waned after encountering resistance at the $1.3 level, highlighting significant selling activity. This led to heightened volatility and sideways consolidation around this critical zone.
During this consolidation phase, a bearish reversal pattern for the head and shoulders formed, with the price now teetering near the pattern’s neckline. A confirmed breakout below this neckline could trigger a short-term correction, with the asset potentially retracing to the 0.5 ($0.82)–0.618 ($0.7) Fibonacci levels.
This corrective move could allow buyers to re-enter the market, potentially fueling the next rally aimed at reclaiming the $1.3 resistance and setting the stage for further upward momentum.