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Wednesday, November 30, 2022

ADA ready to kick-start a 40% rebound rally

  • Cardano price approaches the $1.22 to $1.35 demand zone and 50-day SMA confluence at $1.33, signaling a new uptrend.
  • Investors can expect a 40% upswing that slices through the $1.54 to $1.76 supply to retest the $1.87 hurdle.
  • A breakdown of the $1.20 support level will invalidate the bullish thesis for ADA.

Cardano price showed impressive bullish momentum last week as it rallied to set a higher high. This uptrend faced massive headwinds, leading to a steep correction to a support confluence. Going forward, ADA is likely to kick-start a similar uptrend.

Cardano price ready for a comeback

Cardano price rose roughly 45% between January 10 and January 18, setting up a swing high at $1.64 inside the daily supply zone, extending from $1.54 to $1.76. The resulting retracement knocked ADA down 19% into the recently created daily demand zone, stretching from $1.22 to $1.35.

Interestingly, this support area harbors the 50-day Simple Moving Average (SMA) at $1.33, making this retest a bullish one. Therefore, investors can expect ADA to see a reversal around this area, leading to an uptrend.

The first hurdle Cardano price will face on its new rally is the aforementioned daily supply zone. Clearing this blockade will put the 200-day SMA at $1.82 in ADA’s path. A retest of this hurdle will represent a 36% ascent.

Should the bullishness persist, there is a chance ADA could wick up to retest the weekly resistance barrier at $1.87, bringing the total advance to 40%.

ADA/USDT 1-day chart

While things are looking up for Cardano price, a breakdown of the recently formed demand zone, ranging from $1.22 to $1.35 will indicate a weakness among buyers.  A daily candlestick close below the weekly support level at $1.20 will invalidate the bullish thesis. 

This development could further drag ADA down to retest the daily support zone, extending from $1.02 to $1.20.

 

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