Indicators Flip Bullish on Cardano. Will Prices Follow?

Cardano has been on a decline for three weeks now, shedding a significant fraction. However, current price action shows that the asset is gearing up for a change in trajectory.

The asset is trading at $0.65 at the time of writing.  It prints a red candle as it slightly retraced from its opening price. Nonetheless, the recent price change is not significant, showing a slight change from its dominant trait in the last two Saturdays. During this period, the altcoin saw considerable volatility.

The reason for the change is not far-fetched. Cardano’s volatility is reducing, and the asset is in a rangebound trend. A look at the 1-week chart sheds more light on the drop.

The image above shows that the coin has been in a downtrend since September. However, the trend worsened during the second week of October. ADA retraced from $0.87 to $0.56 but rebounded and closed with losses exceeding 16%.

The decline continued into the next week, and the coin retraced to a low of $0.59 before rebounding and closing with losses of over 5%. It retraced during the current seven-day period, dropping to a low of $0.60, but prints a doji.

Over the last three weeks, the dominant trend has been higher lows and smaller losses. The price movements indicate that the sellers are becoming exhausted and the bulls are absorbing the excess supply. 

The latest trend of lower losses is not new, as it mostly results in a breakout. One such occurrence happened in July and October 2024. This time may not be different.

Cardano Poised For Breakout 

A look at the 1-day chart shows that ADA failed to register any strong upward drive. It opened at $0.66 on Monday and peaked slightly higher. Although it broke the high the next day, the coin retraced and has not retested it since.

Saturday is shaping up to be another session with little volatility, keeping the high. Away from the highs and lows, the chart shows the altcoin has been rangebound since Oct 16.

In several instances when Cardano was rangebound, it marked an impending breakout. Interestingly, the readings from the shorter timeframe tally with those from the 1-week timeframe. 

Aside from price movements, indicators are flashing green signals. It is worth noting that the moving average had a bearish crossover a few weeks ago. However, price actions over the last seven days saw the 12 EMA halt its downtrend. The metric had a bullish crossover during the previous intraday session. 

An Impending Attempt at $0.70

The bollinger bands support the prediction that Cardano will resume its uptrend. A few days ago, the asset slipped below the lower band but rebounded, and it is trading within the bands at the time of writing. However, during its rangebound movement over the last seven days, it edged closer to the middle band.

ADA’s first target after breaking will be the bollinger’s middle band, as prices previously trended close to it. Decisively flipping the mark at $0.70 could prompt a retest of $0.76, a critical level that could signal a return to $0.80, the resistance.

Aside from the bollinger bands, the fibonacci retracement level points to the asset flipping $0.80. However, it suggests that the asset may hover above the 61% mark before such a breakout. 

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