ADA/USD traded within sight of the 1.000000 juncture yesterday, but managed to sustain its price above this key psychological ratio.
As of this writing, ADA/USD is near the 1.128000 mark, which puts it technically close to important value vicinity it traversed on the 19th of July. ADA/USD produced consolidated trading on Monday, but the cryptocurrency was hit by an additional wave of downside pressure yesterday. However, after hitting lows near the 1.020000 mark, ADA/USD was able to produce a reversal higher and now finds itself testing Monday’s values again.
The 1.130000 level could prove to be an important technical area for ADA/USD short term. If this resistance level is not able to be surpassed and the price of Cardano continues to see a sustained amount of trading below, nervous technical sentiment may perceive this as a negative indicator. While the reversal higher from 1.020000 to near 1.125000 is significant, ADA/USD does remain within the lower end of its mid-term range.
The notion that ADA/USD is ‘only’ at the lower part of its mid-term range should make bearish and bullish traders rather intrigued. While ADA/USD near late February values, Cardano has not slipped quite as much as some of its major counterparts. Yes, in the middle of May ,ADA/USD was trading within sight of the 2.470000 level and it has lost more than half its value since then, but the cryptocurrency is still within the lower price ratios of its value after the exuberant bubble began to expand.
Bearish traders can interpret this as a technical signal that ADA/USD may have further room to decline and take note that Cardano was trading near 0.800000 in the middle of February. While ADA/USD bullish speculators may believe this is a sign that the cryptocurrency may be approaching maximum possible losses, this may prove an ineffective theory and costly. Yes, ADA/USD can certainly produce reversals higher and certainly will. However, wagering against the prevailing mid-term trend which has been almost exclusively a one-way ticket downwards may be the wrong decision near term.
If ADA/USD continues to languish near Monday’s value in a consolidated manner and does not show signs of penetrating resistance levels near the 1.130000 to 1.1320000 junctures, traders may want to start looking for more downside action. Limit orders should be used along with stop losses, because ADA/USD can pack a punch and volatility can be swift. Selling ADA/USD short term on slight reversals higher in order to look for lower values may be the correct wager.
Cardano Short-Term Outlook:
Current Resistance: 1.132000
Current Support: 1.112500
High Target: 1.15400
Low Target: 1.051000