Hi friends! Welcome to this analysis on Cardano! Looking at the four hour chart, we can see that after breaking the uptrend support (black dots,) ADA/BTC has turned to the upside, to retest the former support level
. What happens here is critical. If ADA/BTC has a sustained breakout back above this rising support level
, it will signal a failed breakdown. However, if it fails at the rising trendline
, it will be confirmation that the rising trendline
is now overhead resistance. At that point, further downside would be increasingly likely. With that said, there is a nice amount of support just below. We have the 50 EMA
(in orange,) the 200 EMA
(in purple,) and the critical 50% retrace. The 50% retrace is critical to hold, because it has recently proven to be a major support level
. Also, we can see that the rise up to it was parabolic. When a parabolic move takes a market higher, it shows that there is no real resistance in the parabolic area. Therefore, if we fall below the 50 EMA
, there is a high probability that ADA/BTC will plummet, due to a lack of support. On the upside, a sustained break above the 38.2% retrace, will be a very strong sign. Such a move, could easily open the door to the 6900 level, the 23.6% retrace, and then the all time high. We need to pay close attention to ADA/BTC right here, to know which way it will move. The MACD
is on the rise, signaling an expansion in buy-side momentum, but price action needs to break above the rising dotted trendline
to confirm the momentum. The best thing to do, is just sit back, and let the market show us which way it wants to move. Look for a sustained breakout, keep an eye on those critical levels, and stick with your friendly market legend for future updates.
This has been your not-so-humble market wizard, droppin' knowledge like bombs in this place! Please follow, comment, like, and share on social media. Good luck trading everyone!
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
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