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Cardano Price Analysis ADA / USD: Pushing For Recovery

After losing over 60% of its value, ADA is attempting a recovery.

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  • Cardano remains bearish over the short and medium-term horizon
  • The four-hour time and daily time frames both show bearish head and shoulders patterns in play
  • The ADA / USD pair has returned to its January 2019 opening price after recently suffering triple-digit losses

Cardano is attempting to stage a short-term upside recovery, as a much-needed rally across the broader digital currency market helped to boost the embattled cryptocurrency.

The ADA / USD pair has been one of the worst-performing digital assets over the last few months, with the cryptocurrency losing over 60% from its 2019 price peak and falling outside the top 10 by market capitalization.

The cryptocurrency now trades basically flat on the year, after recently recovering around fifteen percent in value from the September 26th trading low.

SIMETRI Research

Cardano still remains in a vulnerable technical position, with both the four-hour and daily time frames showing the cryptocurrency still trading below the neckline of sizeable head and shoulders patterns.

A lack of bullish pattern patterns or bullish MACD price divergence across the higher time frames does little to suggest that the ADA / USD pair is likely to stage a sustainable rally over the medium-term.

However, the four-hour time frame is showing a bullish pattern that does suggest that further near-term gains are possible for ADA / USD pair. Short-term technical indicators are also pointing to further short-term gains and have yet to reach overbought conditions.

According to the size of the descending triangle pattern on the four-hour time frame, the recent recovery could extend towards the $0.044000 resistance level.

The daily time frame shows that the ADA / USD pair would need to rally by around sixty percent from current levels to reclaim its technically bullish status.

According to the latest sentiment data from TheTIE.io, the short-term sentiment towards Cardano is neutral, at 54.00 %, while the overall long-term sentiment towards the cryptocurrency is very bearish, at 24.00%.

 

 

ADA H4 Chart October 8 by TradingView
ADA / USD H4 Chart by TradingView


Upside Potential

The four-hour time frame highlights that the ADA / USD pair is approaching its 200-period moving average, around the $0.044000 level. A sustained break above the $0.044000 level could lead a much-stronger recovery.

The daily time frame shows that the neckline of a large head and shoulders pattern offers a potential upside target if the rally continues, around the $0.056700 level.

 

ADA Daily Chart October 8 by TradingView
ADA / USD Daily Chart by TradingView


Downside Potential

The four-hour time frame is showing that a bearish head and shoulders pattern is in play, which could send the ADA / USD pair towards the $0.030000 level.

The daily time frame highlights the ADA / USD pair’s all-time trading low, around the $0.025000 level, as a possible downside target if a strong bearish reversal occurs.


Summary

Cardano is attempting to stage a near-term upside recovery after the cryptocurrency suffered four consecutive months of trading losses.

The ADA / USD pair could continue its recent bearish descent if it fails to overcome its 200-period moving average on the four-hour time frame.

 

Check out our coin guide for the Cardano project.

Cardano also received the SIMETRI treatment, a full analysis of its merits and challenges together with our updated investment grade.

Cardano Chart

 

DISCLOSURE

Authors at Crypto Briefing are invested in cryptocurrencies. The author of this post may be invested in digital assets mentioned here.

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