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05/15/2024

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What’s Next For Cardano? Analyst Weighs

An analyst from Crypto Capital Ventures is optimistic Cardano (ADA) is poised for a breakout despite current market conditions.The expert cites a bearish sentiment surrounding the 50-day moving average...

What’s Next For Cardano? Analyst Weighs

Cryptomode What's Next For Cardano? Analyst Weighs

An analyst from Crypto Capital Ventures is optimistic Cardano (ADA) is poised for a breakout despite current market conditions.

The expert cites a bearish sentiment surrounding the 50-day moving average crossing below the 200-day moving average in Cardano’s (ADA) chart.  Contrary to the common belief that this indicator signifies the end of the bull cycle, he argues that it is a lagging indicator and might be more bullish than bearish. He states that this indicator is not necessarily a bearish signal, as it occurred during a consolidation phase in the crypto market. By referencing similar occurrences in other altcoins like Avalanche (AVAX) and Ethereum (ETH), projected to pump on ETF approvals, he explains that the ADA chart showed promising momentum data from a longer-term perspective.

Using historical examples, including one from June 2023, the expert demonstrates that this crossover often indicates that the worst is over and the asset is in a consolidation or bottoming-out process. Emphasising the importance of patience and looking at the broader context of the crypto market cycles, the expert suggests that the indicator, which occurs when a short-term moving average crosses below a long-term moving average, is often interpreted as a bearish signal that could precede a downward trend. 

However, he argues that this interpretation lacks context and that the indicator may signal the end of a bearish trend rather than the beginning of a new one. He also points out that the current oversold environment in the short-to-mid term may lead to an explosive move for ADA.

Discussing the current state of Cardano, recently integrated on CoinGate, the expert emphasises the importance of patience during market consolidation. He acknowledges that market moves can be frustrating but are necessary for the eventual bull run. He also mentions the RSI and MACD indicators, noting that the MACD histogram being in the red and consolidating is a sign of needed consolidation before a potential bull run. This comes as other analysts also predict the altcoin is about to explode.

Cardano Price Review: How is ADA Doing Today?

Looking at technical indicators, the chart indicates a Double Bottom pattern, typically a bullish reversal pattern signaling a potential upward movement. If the pattern were complete, the Cardano pump would go to higher highs. On the other hand, the Money Flow Index (MFI) is currently at 38.74, indicating that ADA is neither overbought nor oversold. 

4-hour ADA/USD Chart | Source: TradingView

This neutral reading suggests that there is room for the price to move in either direction, but with the recent price increase, a bullish sentiment might be emerging. On the other hand, the Awesome Oscillator (AO) shows green bars, indicating bullish momentum. The recent positive bars suggest increasing buying pressure. Based on CoinMarketCap stats, Cardano was trading at $0.4473 as of 1:39 p.m. UTC, representing a 3.07% increase over the last 24 hours. 

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