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Elevenews

10/05/2023

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Cardano price could dip 5% amid growing overhead pressure - ELEVENEWS

Cardano price is attempting a recovery rally on higher timeframes after a 35% fall from the July 12 high of $0.3793. The odds still favor the downside and ADA could fall 5% to test the support floor at...

Cardano price could dip 5% amid growing overhead pressure - ELEVENEWS
  • Cardano price is attempting a recovery rally on higher timeframes after a 35% fall from the July 12 high of $0.3793.
  • The odds still favor the downside and ADA could fall 5% to test the support floor at $0.2415.
  • Invalidation of the bearish outlook will occur once the altcoin records a three-day candlestick close above the $0.3082 level.

Cardano (ADA) price is attempting a recovery rally on the higher timeframes, recording three consecutive higher highs as indicated in the chart below. However, bulls must do more if the trend is to be sustained, with overhead pressure building up to cloud the token’s upward momentum.

Cardano bears eye a 15% slump

The Cardano (ADA) price recovery rally seems limited amid growing overhead pressure. It faces the initial resistance at $0.2710, with several other layers above it representing supplier congestion levels. Specifically, the 50-day Exponential Moving Average (EMA) at $0.2907 is critical, coinciding with the supply zone, which is an order block ranging from $0.2907 to $0.3292.

Meanwhile, the Relative Strength Index (RSI) remains below the 50 level and edging south as momentum continues to fade. This is trailed by the lagging Awesome Oscillator (AO), still in the negative territory.

With these, Cardano price is likely to head lower, possibly tagging the support floor at $0.2415. In the dire case, the slump could continue, potentially going as low as the $0.2200 range low.  Such a move would constitute a 15% slump below current levels.

ADA/USDT 3-day chart

Data from the on-chain aggregator “IntoTheBlock’s Global In/Out of the Money” (GIOM) metric shows that a lot of supply barriers abound above for Cardano bulls, and will likely prevent ADA from achieving its upside potential. Based on this on-chain metric, multiple supplier congestion zones are present, with the first occurring between $0.2642 and $0.2945 where 251,880 addresses bought approximately 4.01 billion ADA tokens at an average price of $0.2795.

ADA GIOM

However, renewed buyer interest and therefore momentum could send Cardano price above the immediate $0.2710 hurdle, clearing the path into the supply zone at the $0.2907 level. A decisive three-day candlestick close above its midline at $0.3082 would invalidate the bearish outlook. Above and beyond, ADA could break out from the supply zone, flip it to a bullish breaker before tagging the 100-day EMA at $0.3472. Such a move would denote a 50% climb above current levels

Source

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