Cardano (ADA) price analysis: Is $0.29 the bear market low?
Cardano (ADA) has been in a strong downtrend since hitting its all-time high of $3.10 on 2 September 2021. The bulls are trying to stop the incessant fall near $0.30 in the week beginning 12 December 2022 while the bears are attempting to break the support and strengthen their hold.
The markets have a peculiar way of reacting to newsflow. During a bull phase, every bit of positive news is cheered by an increase in price, but during a bear phase, the price hardly reacts.
Cardano’s parent group Input Output Global (IOG) recently unveiled a new privacy-focused blockchain called Midnight and its new token, called dust.
ADA to USD
IOG’s chief executive, Charles Hoskinson, said in an interview with CoinDesk: “Midnight has evolved privacy-coin technology, where everything was anonymous by default, which is what zcash and monero did with Snarks and ring signatures. This is a completely new way of writing and running private smart contracts and private computation. So you can have a private DEX [decentralised exchange], or go mine an anonymous data set, or these types of things.”
In a separate interview on Corey’s Crypto Coin Show on YouTube, Hoskinson said: “It’s a really hard product. It’s the hardest product we’ve ever worked on, and it makes Cardano look like kid’s play.”
Apart from the new blockchain, cardano’s ecosystem has also seen several developmental activities. The Weekly Development Report released on 9 December shows 1,151 projects being built on cardano, and the number of native tokens on the network has reached 7.2 million.
Every Friday, we publish our weekly #Cardano development update. So for the lowdown on what IOG's dev team has been working on last week, head on over and take a look????https://t.co/udW6gkdFhp
— Input Output (@InputOutputHK) December 9, 2022
Will the newsflow prove to be positive and could Cardano go up? Read the ADA price analysis to find out.
Cardano technical analysis: Weekly chart
ADA weekly chart for 12 December 2022 – Source: Capital.comADA’s price has been in a strong downtrend. The downsloping moving averages indicate advantage to bears but the positive divergence on the relative strength index (RSI) suggests that the selling pressure could be reducing.
Buyers will have to push and sustain the price above the 20-week exponential moving average (EMA) to start a sustained recovery. The ADA/USD pair could then rally to the 50-week simple moving average (SMA) and thereafter to $0.68. A break above this level could suggest a potential trend change.
Conversely, if the price continues lower and breaks below the vital support at $0.29, it will signal the resumption of the downtrend. The pair could then plummet to the next support at $0.25.
What is your sentiment on ADA/USD?
Cardano technical analysis: Daily chart
ADA daily chart for 12 December 2022 – Source: Capital.comCardano’s price has dropped to the critical support at $0.29. The long tail on the day’s candlestick suggests that the bulls are trying to defend the level. Buyers will have to drive the price above $0.33 to suggest the start of a recovery.
The pair could then attempt a rally to $0.37. The 50-day SMA may offer a minor resistance but it is likely to be crossed. The next major test for the bulls is expected to be at the breakdown level of $0.39.
This bullish view could be invalidated if the price turns down from the 20-day EMA. Such a move will indicate that the sentiment remains negative and traders are selling on rallies. That could increase the likelihood of a break below $0.29. The pair could then start the next leg of the downtrend.
Cardano: Buy or sell at current levels?
Cardano remains in a firm bear grip. If the $0.29 support cracks, the pair could resume its downtrend toward $0.25. A minor positive in favour of the bulls is that the RSI is showing signs of a positive divergence. If bulls push the price above $0.33, cardano’s price analysis suggests a relief rally to $0.37 is possible.
The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision.
Markets in this article
Related topics
