ADA, the native token of the Cardano ecosystem has recently rebounded from the combined support of $0.46 and 50% Fibonacci retracement level. Amid the current relief rally in the market, this altcoin surged nearly 12% to currently trade at $0.51. This rising price encounters supply pressure at the resistance trendline of a pennant pattern. Here’s how this chart pattern could bolster sustainable growth in Cardano price.
Bullish Pennant May Bolster Cardano Price to Reclaim $0.7
- The flag pattern breakout would signal the end of the correction trend in the ADA
- The $0.543 and $0.62 stand as significant resistance levels in the recovery path.
- The intraday trading volume in the ADA coin is $286.3 Million, indicating a 35% loss
Cardano (ADA) Price| TradingView Chart
The Cardano (ADA) coin entered a new correction trend in December end when the price topped at $0.677 resistance. This bearish trend led to a significant drop, with the altcoin losing over 33% of its value to touch a low of $0.447 at the 50% Fibonacci retracement level.
The daily chart analysis reveals that this retracement trend closely followed two converging trend lines, culminating in a pennant pattern formation. This pattern suggests a temporary pullback in the asset, potentially setting the stage for a resurgence in bullish momentum.
In recent trading hours, the ADA price saw a 1% increase, hinting at a bullish breakout from the resistance trendline of the pennant pattern. A confirmation of this breakout, marked by the closing of the daily candle, could set the stage for a new recovery trend, with buyers possibly aiming for targets of $0.62 and then $0.675.
However, the presence of a long wick on the daily candle points to ongoing resistance from sellers at the descending trendline. Should this selling pressure continue, the Cardano Price might face another reversal, extending its current bearish trend.
Technical Indicator
- Relative Strength Index: The daily RSI slope moving flat at the midline reflects a neutral sentiment in the market.
- Bollinger Band: The shortening range better the Bollinger band boundaries reflect the market volatility is rising.
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