Cardano (ADA) Faces Resistance: Is a Fresh Surge Coming?

Cardano (ADA) has been facing significant resistance in recent trading sessions, with its price struggling to maintain momentum above key levels. After attempting a surge past the $1.30 mark, ADA has experienced a pullback and is now consolidating. Traders and investors are keeping a close eye on whether Cardano can overcome resistance levels around $1.20 and $1.24 to spark a new rally.
Price Correction and Consolidation
Cardano’s price started to correct downward after it failed to hold above the $1.30 level. The price briefly dipped below $1.20, falling even further to $1.1173 before bulls stepped in to support the token. As a result, ADA has been trading in a consolidating pattern, currently facing hurdles at the $1.20 and $1.24 resistance zones.
The price is now below the critical $1.20 mark and the 100-hour simple moving average, which is a bearish indicator in the short term. Additionally, there is a key bearish trendline on the hourly chart with resistance at $1.20, which could further hinder ADA's upward momentum.
Potential for a Fresh Increase
Despite the recent pullback, ADA has shown signs of strength. The price managed to break above the $1.140 and $1.155 levels, surpassing the 50% Fibonacci retracement level of the downward move from the recent swing high of $1.326 to the low of $1.117. This suggests that Cardano could still be setting the stage for another upward movement.
However, the bears have been active near the $1.25 region, protecting the 61.8% Fibonacci retracement level. ADA’s next challenge will be clearing the $1.20 resistance zone and breaking through the trendline at $1.2450. If Cardano manages to close above this resistance level, it could trigger a strong rally toward the $1.278 region, and possibly even further toward $1.320.
Risk of Another Decline
On the flip side, if ADA fails to clear the $1.20 resistance level, the price could start another downward move. Immediate support is found near the $1.150 level, followed by the next major support at $1.120. If Cardano breaks below $1.120, it could test the $1.080 level. A further decline might lead the price toward the $1.045 region, where bulls could potentially step in to support the asset.
Technical Indicators
- Hourly MACD: The MACD for ADA/USD is gaining momentum in the bearish zone, indicating a potential continuation of the downward trend if the price fails to break higher.
- Hourly RSI: The Relative Strength Index (RSI) for ADA/USD is currently below the 50 mark, reinforcing the bearish sentiment in the short term.
Key Support and Resistance Levels
- Major Support: $1.120, $1.080, and $1.045.
- Major Resistance: $1.20, $1.225, and $1.2450.
Conclusion
Cardano is currently in a critical phase, battling key resistance levels at $1.20 and $1.2450. While there are signs of a potential price surge if these levels are cleared, ADA faces significant hurdles. Investors will need to watch the $1.20 resistance level closely, as a failure to break above it could result in another decline. On the other hand, a sustained rally above $1.2450 could lead to a more substantial price increase toward the $1.2780 and $1.320 levels.
As always, traders should be mindful of the prevailing market conditions and use caution when entering positions around these key levels.
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