Cardano’s Uptrend Hampered by Correction, Will It Test $0.3 Support Level?

A crypto analyst tweeted that the Tom Denmark (TD) sequential indicator was giving out a sell signal for Cardano on the daily chart. This shows that ADA’s uptrend could come to an end very soon, as ADA could retest the $0.3 support level.

When looking at the price action of Cardano for the past seven days, it could be noted that it was making higher highs and high lows. It was trading at $0.3013 when the markets opened for sale. After a quick submerge into the opening, ADA started its rise. During this brief fall, ADA registered its lowest price of $0.2856 on the first day itself. ADA reached its highest price of $0.3753 on the seventh day of the week.

After reaching its highest price, ADA is now making lower highs and is trading at $0.3446 at press time. When looking at the chart below, it can be seen that Cardano is trading inside a symmetrical triangle pattern. The fluctuation of ADA got narrower and narrower with the completion of the pattern. Now that the breakout has happened, we could expect ADA to reach $0.41.

The above thesis is based on the best practice of transposing the height of the triangle at the initial stage of its formation to the breakout point. Although there is more room for ADA to increase a little further, the Bollinger bands could be an obstacle that could deter this rise. This is because ADA has touched the upper Bollinger band and is overbought; hence, there could be a retracement.

However, if the ADA bulls charge and break the resistance at $0.41, then it could reach $0.45. But if this rise is interfered with, then ADA may reach for support from the $0.3 support level.