Cardano (ADA) Price Watch: Watch Out for this Reversal Breakout Correction

Cardano Price Key Highlights

  • Carano recently broke above a descending trend line to signal a reversal from the downtrend.
  • Price found resistance at 0.2400 and could be due for a pullback before heading higher.
  • Applying the Fibonacci retracement tool shows the next support levels.

Cardano is pulling back to gather more bullish momentum after its upside break from a descending trend line.

Technical Indicators Signals

The 100 SMA is below the longer-term-200 SMA to signal that the path of least resistance is still to the downside. This means that the selloff is more likely to resume than to reverse. Price is also trading below the 100 SMA dynamic inflection point to signal the presence of bearish pressure.

RSI is also on the move down to confirm that sellers have the upper hand. Stochastic is also heading south so ADA could follow suit. However, both oscillators are dipping into oversold territory to signal exhaustion and a potential return in buying momentum.

ADAUSD Chart from TradingView

Market Factors

The Cardano platform prepares for the next phase of development after launching KVEM and is starting to generate more investor interest these days.  According to its development team:

“This is the first smart contracts testnet for Cardano. Smart contracts must be formally verified, so they run exactly as specified and are free from bugs or flaws. Only then can they be widely adopted as financial infrastructure that can be relied upon by billions of people.”

Cardano is a smart contract platform that functions mostly like Ethereum, but it was designed by the IOHK team in such a way that it accommodates numerous upgrades and updates without destabilizing the network with hard forks. As such it, offers the capacity for its blockchain protocol to scale to levels that other altcoins can’t reach. It is already being looked into by governments in developing nations.

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