Cardano Surges 8%: Can It Maintain the $1 Support?

Cardano (ADA) has staged a strong comeback, soaring 8% to reclaim the $1 threshold. The surge follows a wider recovery in the cryptocurrency market, which faced a significant downturn earlier in the week.

Earlier this week, the crypto market experienced a sharp sell-off, causing ADA to plummet by 15% within a 24-hour period. This drop triggered one of the most significant leverage liquidations in recent years, wiping out nearly $1.5 billion in bullish derivative bets. However, as of now, several cryptocurrencies have shifted back into positive territory, with investors eyeing the upcoming U.S. inflation report.

Investors are closely monitoring the U.S. inflation report set for release on Wednesday. Analysts expect the data to reveal that inflation control efforts have stalled but not to a degree that would deter the Federal Reserve from potentially cutting interest rates next week. Market sentiment surrounding this report could play a crucial role in ADA’s short-term price trajectory.

Price Movement and Key Levels to Watch

ADA’s price action this week has been volatile. On Monday, ADA’s price tumbled to $0.911, marking a three-day losing streak. The decline dragged prices below the crucial $1 support level. However, on Tuesday, ADA’s price began a steady recovery from a low of $0.93, eventually regaining its position above $1.

Source: CoinMarketCap

At the time of writing, ADA’s price had risen by 10% in the past 24 hours, hitting an intraday high of $1.09. If ADA’s momentum continues, it could attract more buying interest, potentially propelling the price to its next resistance zone between $1.20 and $1.25.

Potential Upside and Risks Ahead

A successful breach of the $1.25 to $1.33 resistance range could reignite ADA’s bullish momentum. If this occurs, the price might climb further to the next key resistance at $1.64. However, the possibility of profit-taking and overall market fluctuations may create hurdles for ADA’s advance.

Maintaining the $1 support level will be critical for ADA’s bullish outlook. A drop below this level could trigger further selling pressure, potentially pushing the price down to $0.87. Such a sharp decline could delay the resumption of ADA’s upward trend, putting bulls on alert for a potential shift in market sentiment.

With market participants keeping a close watch on U.S. economic data and resistance levels ahead, ADA’s price movement in the coming days will likely determine the strength of its ongoing recovery.

Disclaimer: The information in this article should not be considered financial advice, and FXCryptoNews articles are intended only to provide educational and general information. Please consult with a financial advisor before making any investment decisions.