Cardano (ADA), the eighth largest cryptocurrency by market capitalization, might be eyeing a potential breakout, according to top crypto trader Gareth Soloway.
Potential breakout on $ADA out of a long-term wedge. Beaten down and due for a bounce. First minor resistance at $0.27, then $0.30. Doesn’t mean a bottom is in (we don’t know that yet), but should give some short term relief from the bear market. Breakout negated on any daily… pic.twitter.com/HLKeiHqGUL
— Gareth Soloway (@GarethSoloway) October 21, 2023
Soloway anticipates a potential breakout on ADA out of a long-term wedge. A wedge is a price pattern defined by converging trend lines on a price chart. He characterizes the current price condition for ADA as “beaten down,” and so it may be due for a bounce.
The crypto trader goes on to say that while this does not imply a bottom has been reached, it should provide some short-term reprieve from the bear market. In this case, a daily close below $0.24 could nullify any potential breakout.
On the other hand, if bulls gain traction, the first minor resistance for ADA might come in at $0.27, according to Soloway, and then at $0.30.
On Oct. 19, Cardano’s ADA fell to a significant support level of $0.24; however, bulls successfully held the level. Following that, the price surpassed the daily MA 50 at $0.252. The RSI’s positive divergence implies that the bearish momentum might be fading.
If bulls sustain their momentum, ADA might retest the $0.27 level and then move to $0.28. This region might be aggressively guarded by bears. If the price falls below $0.28, ADA might persist in range trading for a while.
To indicate the return of the downtrend, bears will have to pull the price below $0.24. The next level of support is at $0.22, followed by $0.20.
Further, the daily moving average (MA) 200 at $0.31 might act as a strong barrier in the event of an upside move.
At the time of writing, ADA was marginally up 0.30% in the last 24 hours to $0.257.
Cardano weekly progress
Cardano developer Input Output Global highlights progress and advancements made in the past week in the most recent report.
The Genesis development team created the first draft of a “survivable eclipse duration model.” The Cardano node v.8.5.0-pre was released alongside work on subpar handling of future blocks and improvements in the tracing system to assist in troubleshooting the node.
After the recent node v.8.5.0-pre release, work on SanchoNet governance phase 5 is now being iterated. Project Catalyst continues to onboard all 192 Fund10-funded projects.
