An early morning surge allowed some alts to post minor gains on the back of a broader market recovery, but the same seemed to have been short-lived. While Cardano was quick to catch on to this movement, its price remained restricted below the $1.35 price ceiling. At the time of writing, Cardano traded at $1.34, up by a marginal 0.5% over the last 24 hours.
Cardano daily Chart
Source: ADA/USD, TradingView
Cardano has been floating around the $1.35-mark over the past few days but prices have not been able to break above this upper ceiling. If this trend continues, bears might be able to drive prices back towards the $1.19-1.22 mark when the next wave of selling pressure hits the market. Visible Range’s POC was also present at $1.21, which meant that ADA could stop incoming losses at this level.
Reasoning
A bearish trend was still active in the market as per Directional Movement Index. The -DI remained above the +DI and the two lines diverged at the time of writing. Moreover, bullish momentum was somewhat receding on Squeeze Momentum Indicator and losses could magnify once the market undergoes a ‘squeeze release’. The first red bar followed by white dots would indicate a sell signal. Even the MACD was close to a bearish crossover as the Signal line looked to rise above the fast-moving line.
While a bearish trend was yet to fully emerge, it seemed like ADA was certainly headed towards such a development and Focus should be on the defensive zone of $1.19-1.22 moving forward.
Conclusion
Bullish momentum seemed to be declining in the ADA market and prices could find their way back towards a support zone of $1.19-1.22 in the coming days. Traders could opt to go long at the lower end of this range and exit their positions at $1.48- a region that coincided with the 50-SMA (yellow).
