- Cardano (ADA / USD) rebounds from critical support trendline during Friday’s Asia Pacific trading session.
- The blockchain asset is expected to close above the major waves of the moving average as it can become a multi-asset chain after its hard fork on March 1st.
- Nonetheless, a Death Cross formation offsets the likelihood that more price legs are higher.
- Levels to see
A sell-off on the Cardano market on Thursday lowered the reference instrument ADA / USD by more than 11 percent.
The pair hit a weekly low of $ 1.02, 31 percent below its record high of Feb.27. It later experienced a modest rally after finding support on a short-term uptrend line. The rebound caused the price to attempt a close above its 50 period moving average, only to pull back later due to higher selling pressures near the blue wave.
Cardano is slipping after testing his 50 period simple moving average wave as resistance. Source: ADAUSD on TradingView.com
It is likely that Cardanos ADA will retest ascending trendline support, further pressured by a death cross formed after the 20 period moving average fell below the 50 period moving average. It signals additional selling pressure in the market in the short term.
Should the sell-off continue, ADA / USD could fall towards its 200 period moving average. It’s around $ 0.88 right now. Meanwhile, a prolonged slip below the orange wave would cause traders to view USD 0.80 as their downside target. The level served as a support throughout February.
Bullish Fundamentals for Cardano
The downward revision in the Cardano market follows the price rally of over 700 percent in 2021. ADA / USD rebounded in part due to an overall positive sentiment in the cryptocurrency market, led by Tesla’s $ 1.5 billion investment in Bitcoin. Altcoins tend to track benchmark cryptocurrency price trends.
Second, ADA price rose amid a broader rally among projects competing with Ethereum, the second largest cryptocurrency by market cap and the leading blockchain network with smart contract capabilities. Transaction and gas fees on the Ethereum network rose aggressively during the February session, prompting speculators to place bets on their rivals.
Cardano briefly rose to third place in the list of top cryptocurrencies and was replaced by Binance Coin, a token that represents Binance Smart Chain in addition to a full-fledged cryptocurrency exchange of the same brand.
#Cardano still holds the level of support here.
Must break and flip the 2400 sats area to continue either way.
Otherwise, I’ll look at 1900-2100 next. pic.twitter.com/i9SoHN4YiW
– Michaël van de Poppe (@CryptoMichNL), March 5, 2021
The reason traders increased their bids in the ADA / USD market was because of “Mary” – a hard fork that Cardano turned into a multi-asset chain network after its successful deployment on March 1st. Cardano’s upgrade enables new tokens on its network and offers smart contract services like its rival Ethereum.
“Slowly but surely, the momentum slackens Cardano after Mary Hardfork, ”said Michaël van de Poppe, an independent market analyst. “This is normal. Natural market movements. Hype before the event, calm and after the event, getting back into balance. It’s always like this. ADA will continue later. “
ADA was trading at $ 1.13 at press time.
