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Cardano (ADA) has dropped significantly in recent days. The correction resulted in a price decline of 22.6%.
- The ADA price could lose another 14% in the coming days
- Cardano buyers drop support on 20-day EMA
- The intraday trading volume recorded an increase of 104.6%.
The extended selling activity leads to the fact that the critical supporting EMAs, which are trying to break the support zone of $ 0.45, are broken through to the downside. This provides buyers with the opportunity to take advantage of the price drops.
Cardano shows bullish reversal
The ADA/USD rate shows a bullish reversal, which starts at $ 0.4 and forms a rising channel pattern with a price peak of 47.5%. However, at the time of writing this article, the Cardano price is showing a bearish movement, as it is CoinMarketCap it is traded at $ 0.4551 or with a decrease of 3.07%.
On the daily chart, the ADA course shows the formation of a triple black crow pattern. This shows a significant struggle with hedging on the support of $ 0.45.
The increased selling pressure is mainly manifested by the sudden increase in intraday trading volume and the appearance of long-wick candles.
The continued downtrend on the daily chart reinforces the possibility that Cardano enters a downtrend or falls below the important support zone of $ 0.45.
Against this background, if the key support zone falls below, there may be an opportunity for short selling, with the possibility of a 14% decline to the July low, registered at $ 0.4.
ADA price remains bearish
On the other hand, if there is a rejection of the price, coinciding with the bullish reversal at the support zone of $ 0.45, this could trigger a price increase moving above the 50-day EMA.
For example, the RSI for ADA shows a dramatic increase in the bearish character when it falls below the 14-day half-value line or average line.
A few days ago, ADA managed this false breakout, which caused confusion among market participants. Analysts have observed that the ADA rate rose to $ 0.55, and then fell below the line within a few days. This meant a weekly loss of 12.9%. With these figures, ADA will fall below this mark, especially in August.
The general prospects for Cardano remain extremely declining. The MACD signals also indicate that the ADA price could return to its mid-July lows with the ongoing correction.
Proof of text: Newsbtc
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