Cardano Approaches Critical Breakout Level as Wave Five Rally Targets $1.20

• Cardano nears $0.90 resistance level not seen in three weeks amid market recovery
• Elliott Wave analysis suggests wave four completion depends on channel breakout
• Technical targets range from $1.085 to $1.20 for potential 21-34% gains ahead

Cardano has recovered alongside broader cryptocurrency markets, approaching $0.90 for the first time in nearly three weeks. The 10th-largest cryptocurrency by market capitalization mirrors the bullish trends affecting Bitcoin and Ethereum as trading sentiment improves across digital assets.

The current price movement brings ADA to a crucial technical level that analysts suggest will determine its near-term trajectory. Market analysis indicates this price zone could either confirm a breakout pattern or extend the current corrective phase, making it a pivotal moment for Cardano’s short-term direction.

Elliott Wave Pattern Nears Critical Decision Point

Technical analysis reveals that Cardano’s third wave pushed prices into an ascending channel before peaking at $1.020 on August 14. The subsequent fourth wave correction brought ADA down to $0.782 on September 1, establishing the recent trading range.

A parallel descending channel has formed from the third wave high of $1.02, containing Cardano’s price action until Thursday’s close at $0.894 near the wedge tip. Analyst Itsquintn noted that wave four completion hinges on whether ADA can sustain a breakout above this descending pattern.

While Cardano briefly traded above the wedge pattern today, reaching $0.909, it has since pulled back to test the neckline without confirming a decisive breakout. This retracement suggests the pattern remains intact pending further price action.

The daily RSI currently reads 58.7, positioning below the overbought threshold of 70 while maintaining bullish territory above 50. This reading indicates potential room for additional upward movement before encountering overbought conditions that might trigger corrections.

Should Cardano achieve a sustained breakout from the current channel formation, the fifth wave targets fall between $1.085 and $1.20. These levels align with the upper boundary of the previously identified ascending channel pattern.

From current trading levels around $0.895, a rally to $1.085 would deliver 21% gains, while the $1.20 target represents 34% upside potential. The analyst expects a cooling-off period following any advance to these target levels before determining Cardano’s next directional move.

Additional bullish predictions support this technical outlook. Lark Davies recently projected a rally to $1.20 based on bullish pennant breakout patterns, while Bitcoinsensus has identified a higher target of $1.860 for the current cycle.