The ADA enters the consolidation phase after a weekly drop of 16%.

Cardano is navigating through a fundamental price range, bounded by the $0.75 and $1.3 thresholds, with its recent price action underlining a successful pullback to the previously breached $0.75 support.

The outcome of a breakout of this range will likely set the tone for the market’s next significant direction.

Technical Analysis

By Shayan

The daily chart

Cardano has recently encountered a rejection at the $1.3 resistance level, leading to higher volatility and a bearish retracement phase. As a result, the price settled in the $0.75 support zone, which coincides with a major yearly swing high and is loaded with demand and buying interest. This support has stopped further downward momentum, keeping the ADA confined within the $0.75-$1.3 range.

This consolidation phase suggests increased market pressure, with the potential for a decisive breakout on either side. A bullish break above $1.3 would signal the start of a sustained uptrend, while a bearish break below $0.75 could trigger a major liquidation cascade, pushing the price towards support levels lower ones

The 4 hour chart

In the shorter time frame, Cardano’s price action has been shaped by a descending wedge pattern, a formation that often indicates a possible bullish breakout if the upper limit is broken. The asset is currently sitting around the lower boundary of the wedge, near the $0.75 support zone, where increased buying interest is evident. This area is further strengthened by the critical Fibonacci retracement levels of 0.5 ($0.82)-0.618 ($0.7), solidifying it as a formidable barrier against further selling pressure.

In the medium term, the ADA is expected to continue consolidating within this wedge pattern while maintaining its position above these key Fibonacci levels. A bullish break of the wedge could pave the way for a move towards the $1.3 resistance. Conversely, a bearish breakdown below the lower boundary of the wedge could lead to a deeper decline, with the $0.5 threshold emerging as the next significant support level.

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