Cardano has failed to break through the $ 2.96 price ceiling, but prices have respected an upward sloping lower trend line. As buyers watch a third test of what is shaping up to be stubborn resistance, a breakout to the upside seemed likely, especially given the higher constant lows.
Sentiment was also favorable with Hoskinson providing confirmation of the final testnet launch on September 1. However, the ADA indicators formed bearish setups and presented some obstacles to moving forward. As of this writing, ADA was trading at $ 2.84 with a market capitalization of $ 90.81 billion.
12 hour ADA chart
Higher lows have been broken at regular intervals since the ADA topped $ 1.88 in mid-August. Prices have followed the same pattern prior to last week, where sellers reigned at $ 2.96. While this ceiling has already sparked two rounds of selling pressure, buyers fought back with higher lows.
In the process, an ascending triangle formed, projecting an upward breakout. Calculating the ADA retracement from the highest point to the lowest of the pattern set the price target at $ 3.40, which was another 18% increase from its level at press time. To invalidate this result, sellers would first have to form a lower low below $ 2.70. In addition, a close below $ 2.46 would stimulate further declines in the market.
While the ADA indicators had yet to dip into bearish territory, these warning signs were hard to miss. The Relative Strength Index was still easing after trading in the overbought zone just a week ago. The worrying thing is that the indicator was trading within a descending triangle and was threatening to break out. This observation was also seen in the Awesome Oscillator, which formed two lower peaks and signaled an incoming wave of selling pressure. Meanwhile, the Directional Movement Index was close to a bearish crossover. However, the same has been denied twice and the bulls were expected to break above this signal once again.
ADA appeared to be moving towards an ascending triangle breakout in the next few days. A 15% rise from the upper trend line would push the ADA towards a new ATH at $ 3.40. However, it was not easy for the bulls to navigate. Bearish formations were observed in some of the ADA indicators that could trigger a downside momentum. Therefore, traders should play safely and wait for a breakout confirmation above $ 3.96 before going long.
This is a machine translation of our English version.
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