Cardano has been a slow mover on the charts over the last week, bouncing between $1.21 and $1.18. Bears managed to drive the market below $1.18 at the time of writing, and a session close below this support level may be a sign of more bearish pressure to come in the next 24 hours.
Cardano 1-hour chart
The upper and lower limits of the ADA scale are $1.47 and $1.47, respectively. After late February, the price has been trading inside this band. Gann’s law of eighths was used to identify critical ranges of support and resistance within this scale, with the 50% level at $1.21 being the most significant range within the level.
In the short term, the stock has encountered obstinate opposition at $1.21 in recent days. The price has jumped between $1.21 and $1.17 in the last week, with brief deviations on each side of these values. However, the market fell below $1.18 in the last 24 hours, and momentum turned momentarily in favour of the bears.
This is not a market for shorting, and amid short-term bearish leverage, falls to $1.1 or $1.06 can be longed rather than shorted at the $1.21 resistance.
Following the recent decline from $1.22 to $1.179, the RSI dropped below neutral 50. This decline happened in the market, but this drive could see ADA move to $1.1, the next level of support on the charts.
The Supertrend tracker signalling a sale with a stop-loss of $1.21, the 50% mark in the range.
The OBV set higher highs when the price set lower lows. This meant that purchase demand has recently outweighed selling volume, although the price has failed to break through $1.21. Since there was no trading volume, a short trade was very dangerous.
Momentum was marginally in favour of the bulls, and giving up the $1.18 mark would most likely drive ADA to $1.1 or maybe as low as $1.06. Dependent on market conditions over the next two days, an incentive to long ADA is possible, and the risk-reward ratio would be higher than a short trade made near the $1.21 resistance.
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