Cardano (ADA) is approaching a critical juncture as it anticipates a retest of the key support level of $0.3389. In the past few trading sessions, the ADA price has previously surged above this level and is currently headed downwards for a second retest, thus raising concerns among investors and traders.
A successful defense of the $0.3389 support could signal a possible reversal and fresh bullish momentum, while a breach below this level could open the door for further declines. This article aims to analyze the importance of the $0.3389 support level for Cardano and whether there is a bullish trend impulse can keep ADA above this key threshold by examining technical indicators and market sentiment.
With a market cap of over $12 billion and a trading volume of over $240 million, ADA’s price is down 0.69%, trading around $0.3462 at the time of writing. In the last 24 hours, its market cap has decreased by 0.68%, while its trading volume has dropped by 26.44%.
Current technical indicators: what they reveal about Cardano
On the 4-hour chart, Cardano is trading below the 100-day simple moving average (SMA) and is currently experiencing a downtrend towards the $0.3389 mark. Given this bearish sentiment, it is likely that bears could continue to exert control and push the price to this critical level.
An analysis of the 4-hour Composite Trend Oscillator reveals that both the signal line and the SMA line of the indicator have successfully climbed above the zero line and are now approaching the overbought zone. This suggests that the current decline may be temporary and that the bulls may regain control at the $0.3389 mark.
On the 1-day chart, Cardano is still trading below the 100-day SMA and is attempting a bearish move towards $0.3389, which means that the bears are currently in control and can potentially push the price lower.
Finally, on the 1-day chart, both the signal line and the SMA line of the Composite Trend Oscillator have fallen below the zero line into the oversold zone. This indicates that ADA Price could reverse upon reaching the $0.3389 mark.
Analysis: Potential outcomes if $0.3389 support holds or fails
An analysis of potential outcomes indicates that if the Cardano price reaches $0.3389 support mark and this key level holds, it could start moving higher towards the resistance level of $0.4233. If the price successfully breaks this resistance, it could continue to test higher levels.
However, if the $0.3389 mark does not hold and the price to break Below this level, the digital asset may continue to decline towards the $0.2388 range. If this level is breached, the crypto asset may see further price declines towards other support marks below.