Cardano Bulls Charge: ADA's Market Surge AnalyzedNovember 6, 2023
Dan Gambardello, the Founder of Crypto Capital Venture, has provided an insightful analysis of Cardano’s (ADA) recent price movements. He begins by acknowledging the excitement around ADA’s surge, posing the critical question of whether this uptrend can persist, especially in the short term, and if ADA can hit the 40-cent mark or is due for a decline.
Gambardello refers to the 6-hour chart to illustrate the significance of ADA’s recent performance, which he deems crucial for understanding the transition from a bear to a bull cycle. He notes the importance of ADA’s weekly close above the 50-week exponential moving average (EMA), a bullish signal not seen since around April 2023. This event, according to Gambardello, is indicative of a potential macro shift in market sentiment.
Highlighting Cardano’s advancements, Gambardello points out that, unlike the previous cycle, Cardano now has a staking mechanism, a multi-asset ledger from the Mary hard fork, smart contracts from the Alonzo update, and improvements in scalability and governance. These developments, he suggests, place Cardano ahead of where it was in the last cycle, making the recent price action above the 50-week EMA particularly noteworthy.
Gambardello emphasizes the bullish divergence on the Relative Strength Index (RSI), where ADA is showing a higher high on the RSI despite a lower high in price. He compares this to the previous cycle when ADA last broke above the 50-week EMA, suggesting a similar bullish momentum.
On the daily chart, Gambardello observes that ADA is significantly overbought, which typically leads to a consolidation phase. He speculates that while ADA could potentially reach a high of 45 cents, a substantial retracement is more likely before achieving such a target. He identifies key support levels to watch, particularly the 20-day and 200-day EMAs, currently in the 29 to 30-cent range, and the Fibonacci retracement levels between 28 to 26 cents.
Gambardello concludes by highlighting the growth of the DeFi space on Cardano and the bullish sentiment driven by increasing developer activity. He suggests that while ADA may continue to rise in the short term, a retracement is likely, and the journey to the 45-cent target may be longer and more complex than a direct upward trajectory.
Featured Image via Unsplash
Source: Read Full Article