Cardano Could Retrace Before Targeting $2.70
Cardano looks ready to break out of a bullish consolidation pattern.
Key Takeaways
- Cardano has surged nearly 18% since Monday’s open.
- Further buying pressure could push ADA to $2.70.
- Still, prices could retrace before meeting the bullish target.
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Cardano appears to be catching up with the rest of the market after slicing through stiff resistance. Now, it looks like ADA will present a buying opportunity before further upside.
Cardano Breaks Out
Cardano is back in the green after enduring a two-month-long stagnation period.
The fourth-largest cryptocurrency by market cap appears to have broken out of a descending triangle that developed on its nine-hour chart. ADA had been making a series of lower highs since Sep. 12, creating the pattern’s hypotenuse. Meanwhile, the $1.90 support floor developed the x-axis.
A recent spike in buying pressure allowed Cardano to break out from the bullish continuation pattern and gain 0.38 points in market value. Despite the recent gains, the height of the triangle’s y-axis added to the breakout point at $2.06 suggests that ADA has more room to increase.
A further increase in buy orders could push ADA up another 13% toward $2.70.
It is worth noting that the Tom DeMark (TD) Sequential indicator recently presented a sell signal on Cardano’s nine-hour chart. The bearish formation developed as a green nine candlestick, which is indicative of a one to four candlesticks correction. Therefore, ADA could briefly retrace before achieving its upside potential.
Increasing profit-taking around the current price levels could send Cardano to $2.15, which may present an opportunity for sidelined investors to get back into the market. If this support level holds, ADA would likely resume its uptrend and meet the bullish target presented by the descending triangle.
Disclosure: At the time of writing, the author of this feature owned BTC and ETH.
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