ADA Retraces After New All-Time High Price

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In Brief
  • ADA has bounced at the $1.03 support area.

  • ADA has broken out from a descending resistance line.

  • It is likely in wave four of a bullish impulse.

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Cardano (ADA) reached a new all-time high price on April 14. However, it dropped almost immediately afterward.

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Despite the drop, ADA has held above its previous diagonal and horizontal support levels. An eventual breakout is expected.

Long-Term ADA Movement 

On Feb. 27, ADA reached a then all-time high price of $0.148. While it decreased almost immediately afterward, the drop served to validate the $1.03 area as support. 

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The token bounced afterward and reached a new all-time high price of $1.57 on April 14. However, it has fallen once more since. 

The technical indicators show mixed readings. The MACD is positive but has created one lower momentum bar. The RSI is right at the 70 line. Similarly to the MACD, the Stochastic oscillator has not made a bearish cross but is decreasing. 

Furthermore, there are long upper and lower wicks present. 

Therefore, a look at lower time-frames is required to determine the direction of the next move.

Current Breakout

The daily chart shows that ADA has broken out from a descending resistance line before reaching the all-time high. 

Despite the massive long lower wick, yesterday’s drop only served to validate the line as support. 

However, the token is trading above both diagonal and horizontal support levels. So, the trend can be considered bullish.

ADA Wave Count

The wave count indicates that ADA is in wave four of a bullish impulse (white) that began in March 2020. 

Once wave four is completed, two potential targets for the top of the movement are $1.97 and $2.53. 

The targets are found by using a Fib projection on waves 1-3.

A closer look supports this possibility, showing a parallel ascending channel. This is often a corrective movement.

After potentially another lower low that validates the support line of the channel, a breakout is expected.

Conclusion

To conclude, ADA is expected to break out from the current channel eventually. Afterward, it could increase towards $1.97 and potentially $2.53.

For BeInCrypto’s latest bitcoin (BTC) analysis, click here.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
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Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona graduate school of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst.

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