Cardano [ADA] bulls set their eyes on these two short-term resistances
Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.
Bitcoin traded at $20.8k and bearish pressure did not appear to have ceased yet. Cardano also saw significant selling volume in recent weeks, but over the past four days, it appears to have flipped its bias to bullish. Can the buyers continue to drive prices higher in such a fearful market?
ADA- 1 Hour Chart
The price action of Cardano on the higher timeframes was bearish. Yet, on a lower timeframe such as H1, a bullish move could materialize. In the past four days, the price has formed a series of higher lows. At the same time, it has surged to $0.54 as well.
The $0.5 area is a zone of resistance for the buyers to overcome. At press time, the $0.5 zone and the $0.54 level represent stiff resistances. The move above $0.5 and $0.52 in the past few days suggested that there is a bullish lower timeframe bias for ADA.
If the price formed a lower high below $0.54 and proceeded to dip below $0.47, the bias would flip back to bearish.
The technical indicators showed a decent amount of bullish momentum. The RSI has faced resistance at the neutral 50 line multiple times recently, barring one wild surge to 70. At press time, the RSI appeared to climb above 50 once again.
At the same time, the OBV was also climbing. It has made its way past two significant levels from the past week and highlighted that buyers had some strength.
Given the selling pressure across the market, a move upward might not be the safest bet for an altcoin. Hence, buyers ought to be careful. A move above $0.54 could see ADA rise to $0.57.
The price action combined with the indicators signaled a possible move upward for ADA. Yet, it must be remembered that the higher timeframe bias remains bearish.