Cardano (ADA) encounters massive buyers
The daily candlestick for Cardano (ADA) shows a massive wick indicating strong buying throughout the day. Additionally, Cardano is setup for another breakout over the next few days – but we shouldn’t be surprised to see some tight trading ranges until Monday.
Daily candle shows massive wick
The current daily candlestick for Cardano (ADA) is one that has transitioned from a very ugly and bearish looking candle to one that is very bullish. At the beginning of the daily candle, traders were able to push Cardano all the down to a daily low of 0.00001533 from a daily high of 0.00001696. Cardano remained trading at that bearish range until after the New York open and a significant number of buyers stepped in. The current daily volume on the Cardano/BTC pair is the highest daily volume since April 5th, 2019. Beyond the bullish volume and strong buying that has occurred, there are some other technical factors that are contributing to Cardano’s bounce.
On the chart above, there is a intersection of two yellow lines, one vertical and one horizontal. The horizontal line represents the 1/8th Major Harmonic price level. This particular harmonic level is one of the most powerful support and resistance zones on Cardano’s chart. The vertical line represents a pivot in time and acts as a source of resistance in time to the trend in force. Generally, these yellow time pivots are short term reversals. But when we see both a yellow horizontal and vertical line cross, this creates a square of price and time. These are extremely powerful confluence zones which see price make massive moves. The direction here seem fairly predictable. If you observe the highs over the past 10 trading days, they have all stopped against the closest arc. Price has essentially been following the contour of that arc and following it as a source of resistance. It appears that the present and near term future trading will continue to see Cardano respect that arc as resistance, but the 1/8th Major Harmonic will remain as support.
That kind of activity will create some substantial consolidated trading conditions over the next five days. The most likely scenario will be constricted trading ranges until Cardano moves beyond the current arc. After that, then there is a clear path toward the 0.00001850 value area. However, prices could still experience a bullish breakout and move beyond the arc in a very fast and bullish manner. That scenarios is the least probable – but if Bitcoin were to experience a substantial bounce and influx of buyers, that would be certainly be a catalyst for Cardano to bounce. Fundamentally, Cardano(ADA) continues to have a significant amount of bullish news and near term releases. The Shelly update has been complete and very soon the mainnet will begin allowing staking pools – one of the final steps required before the actual Cardano blockchain network is fully launched.
Shield Wall Trading, LLC