- ADA is trading within the long-term support at $0.36.
- It follows a descending resistance line.
- The weekly and daily RSI remain bearish.
Cardano’s (ADA) price is trading within a significant horizontal support area but has yet to show signs of a bullish reversal. Cardano’s price has fallen below a descending resistance line since August 2021. So far, the decline has led to an October low of $0.3321. The low occurred inside the $0.36 horizontal support area. This is a crucial flat level as it acted as resistance in May 2018 and February 2021.
After the ADA price broke out, it started a rapid upward movement, leading to an all-time high of $3.10. No bullish reversal signs yet. The weekly RSI continues to fall below a descending resistance line (green) and has not generated a bullish divergence. Also, the ADA price has yet to break out of its descending resistance line.
ADA Price Could Bottom at $0.32
Currently, if ADA manages to break out of the line or instead breaks below the $0.36 support area, it could determine the direction of the future trend. Symmetrical Triangle. This happened on October 2 and confirmed the start of a new five-wave move lower (black).
On October 23, FTX CEO Sam Bankman-Fried tweeted that the exchange plans to list ADA in the future. ADA is currently not listed on the spot exchange FTX but on the futures exchange. The price started an upward move soon after. However, it is possible that the move was part of the count.
If the count is correct, Cardano’s price is currently pulling back in what will likely be the fourth wave. Therefore, another final move will follow, leading to the bottom, through the 1.27 outer Fib retracement of the triangle.
Otherwise, the next Fib support area would be $0.23. While this would align better with the breakout of the long-term $0.36 price range, it would mean that the fifth wave would be highly extended. Conversely, raising one move of $1 down to 0.43 (red line) would invalidate the ADA bearish price forecast. Instead, it would mean that the news is that a bullish reversal has begun. It is worth noting that technical analysis indicators are declining. Similar to the weekly RSI, the daily RSI remains bearish. It has not generated bullish divergence nor broken its descending resistance line (green line).