Why Cardano Needs To See A Bounce Off Support — Or Things Could Get Ugly

Cardano (CRYPTO: ADA) is trading lower Wednesday, falling in a crypto market that looks to be pushing lower overall. Cardano is trading within a pattern and looks to be at a possible support area, looking to see a bounce higher soon. Cardano was down 7.85% at $1.63 at last check.

Cardano (CRYPTO: ADA) is trading lower Wednesday, falling in a crypto market that looks to be pushing lower overall.

Cardano is trading within a pattern and looks to be at a possible support area, looking to see a bounce higher soon.

Cardano was down 7.85% at $1.63 at last check.

Cardano Daily Chart Analysis

  • Cardano is at support in what technical traders call a falling wedge pattern. The crypto looks to be in a key time where it needs to bounce at support.
  • Connecting the highs and lows together shows two lines that are both falling, but with highs falling at a steeper slope than the lows. This forms into a wedge pattern, where a break of one of these levels hints a possible further move in the same direction is occurring. 
  • The crypto trades below both the 50-day moving average (green) and the 200-day moving average (blue), indicating the crypto is seeing recent bearish sentiment.
  • Each of these moving averages may hold as an area of resistance in the future.
  • The Relative Strength Index (RSI) has been falling the past few weeks and now sits at 30. This is on the border of the oversold region, showing the crypto is seeing many more sellers than it is buyers.

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What’s Next For Cardano?

Bullish traders are looking to see Cardano bounce off the support level in the pattern and start to head higher. Bulls are looking to see the crypto begin to form higher lows and push toward resistance. Bulls want to see the crypto be able to break above resistance for a possible long-term trend change.

Bears look to be in control of the crypto and are hoping to see it continue to fall lower. Bears would also like to see the crypto keep holding below the moving averages for sentiment to remain bearish.

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