Cardano (ADA) Correction Underway: Time To Buy The Dip Or Cut Losses?

The crypto markets have been a wild ride lately, with altcoins like Cardano (ADA) seeing astronomical gains. But Cardano is now experiencing a correction that has investors wondering – is this just a temporary dip before the party resumes, or the start of a bigger downtrend?

According to a popular analyst Trend Rider, while ADA’s overall vibe remains bullish, it’s losing a bit of steam. The latest price candlestick closed below a key charting level dubbed the “parabolic line” – often a bearish signal in traderspeak. However, Trend Rider notes ADA still has solid support between $0.45 and $0.52 to catch any further slides.

Interestingly, while most altcoins have been swept up in the downdraft below a key “red line” watched by traders, Bitcoin itself has stayed firmly above it around $62,000. This divergence from the lead cowboy could be a positive sign that the wider crypto herd will regroup and charge again.

According to Trend Rider’s analysis, the recent breach of the red line was almost expected, signaling a temporary rodeo clown break to let ADA catch its breath through some sideways chop. As such, the analyst cashed in some chips last week but still has a chunky core position riding, anticipating ADA will eventually find its footing and bounce back toward juicier entry levels.

If ADA does indeed mosey back down to that buy zone over the next week or so, Trend Rider sees it as prime time to open up some leveraged long bets on shorter timeframes to amplify any potential rip back upwards. However, if Bitcoin flexes its muscle again soon with a rally, ADA may just be able to hop back on the bull without revisiting lower levels.

Despite the current uncertainties, Trend Rider remains a steadfast ADA bull for the long haul, hence still holding that bigger position through the turbulence. The analyst is also keeping a beady eye on an indicator called the “oscillator” where a flashing red circle could foreshadow more extended rodeo clown breaks ahead.

Cardano’s Fractal Patterns

Adding to the narrative is well-known analyst Ali, who tweeted that Cardano’s current price action resembles the pattern observed from 2018 to 2021. If this fractal continues, Ali anticipates ADA to consolidate between $0.55 and $0.80 in the coming weeks, followed by a surge to $1.70. After this upswing, a further period of consolidation could set the stage for a breakout to $5.

However, market cycles are inevitable, with euphoric rallies giving way to shake-outs that test investors’ conviction. Whether ADA’s retreat is a prime buying opportunity or a broader top remains to be seen.

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