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As Bitcoin’s price recovered from its drop below $30,000, so did the Cardano market. Taking into account the cryptocurrency’s recent drop and recovery on the charts, ADA remained volatile as well, especially given that ADA’s price had dropped by half since its peak in May. The digital asset was trading at $1.16 at the time of writing, with a market capitalisation of $37.57 billion.
Recent recoveries have highlighted the market’s buying pressure. Will it, however, be sustained?
Cardano [ADA] 12-hour chart
The ADA price fell within a descending channel and broke down to $1.01 on the attached 12-hour chart. However, the price quickly managed to stay above the $1 mark. At the time of publication, ADA was trading at a critical level; if buyers provide support, the price may move to test the resistance level at $1.29; otherwise, the price may fall to $1.08 and consolidate.
As the press time price level received support from market traders, these two scenarios were viable. Despite the fact that the Point of Control [Red line] remained high at $1.34, the Visible Range highlighted a rising histogram. Furthermore, as a result of the recent price increase, bearishness has undoubtedly decreased, potentially resulting in a trend reversal.
The Relative Strength Index confirmed this increase in buying pressure. When the price fell, the RSI fell into the oversold zone; however, the subsequent recovery brought enough buying pressure to push the asset back into balance. At the time of writing, ADA was close to equilibrium, with the RSI moving sideways at 43.
Nonetheless, the overall market bearishness persisted. The sell-off triggered by the falling price of ADA gave way to more southbound market pressure. The -DI remained higher than the +DI; however, the recovery narrowed the gap between the two lines. Finally, the Directional Movement Index indicated that downward pressure was high.
The ongoing Cardano market has reached a tipping point. The recent recovery in the altcoin’s value has pushed the price higher, and it can only be sustained with the help of traders. However, with bearishness dominating the market, ADA could lose support at $1.16 and fall to $1.08 before consolidating.