Cardano (ADA) Price Analysis: Will The Critical Support Continue to Hold?

26 Sep 2023 by Crypto Presale 2 min read

Cardano (ADA) continues to trade around the $0.24 critical support level and is looking to get ready for a rally. ADA has been on a continued downtrend in the last few weeks, falling by 11% in the last 90 days, 5.44% in the last 30 days, and 2.35% in the last 7 days. This shows that ADA is in a strong downtrend; however, the buyers are doing a good job of defending the key level at $0.24, but for how long?

Several factors contribute to this downward trajectory. Firstly, concerns about potential interest rate hikes have cast a shadow over the entire cryptocurrency market. Secondly, the ongoing crackdown by the U.S. Securities and Exchange Commission (SEC) on various crypto projects has created uncertainty and negative sentiment.

Additionally, the strengthening of the U.S. dollar in the global financial landscape has put pressure on ADA and other cryptocurrencies, as a strong dollar can lead to a reduction in demand for alternative assets like digital currencies. These combined factors have contributed to ADA's continuous price decline.

Technical Analysis

Daily Timeframe

Source: TradingView

After falling for several weeks, ADA is now resting on a critical support zone around the $0.24 level. Sellers have tried to break below this zone three times this year, and the buyers have resisted them. Will this zone continue to hold? Right now, ADA is trading below both the 50-day and 200-day EMAs, which means the overall trend is currently bearish. Also, the RSI is at 41.60%, which means the sellers are still dominant in the daily timeframe. If this selling pressure continues, we might see ADA break below this zone.

4 Hour Timeframe

Source: TradingView

In the 4-hour timeframe, the RSI is at 50.37%, which shows that the buyers might be getting stronger and the trend might be changing from bulls to bears. However, ADA is still trading below the exponential moving averages, which means the trend is still bearish. Before we can confirm a trend reversal, ADA will have to break above the resistance level at $0.26. If the token fails to break above this zone, the sellers might step in and continue to push the price lower.

Will The Critical Support Continue to Hold?

It’s too early to confirm if this zone will continue to hold or not. Traders should keep watching price action around this zone and how Cardano (ADA) reacts to the overall market condition. A break and close above $0.26 might be the first step to indicate a trend reversal.

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