ADA Technical Analysis: Will ADA Avoid A Fall To $0.38?

The ADA price action shows a power struggle at the crucial demand zone at $0.43 after a head and shoulder breakout. The bearish breakout of the $0.43 support level can lead to a downfall breaking the 52-week of $0.38. So, will the bearish breakout rally crash the Cardano under the $0.38 mark?

Key Points:

Source-Tradingview

ADA Technical Analysis

The ADA price action shows a power struggle at the $0.43 support level after failing to sustain above the 50-day EMA. The 7% drop in the Cardano market value results in a bearish engulfing candle leading to the head and shoulder pattern.

The spike in the intraday trading volume supports the bearish engulfing candle, increasing the possibility of a continued downtrend. Hence, the traders can find selling opportunities in the current market, speculating a downtrend.

A daily candle closing below the $0.4166 neckline support will accelerate the bearish momentum and trigger the aforementioned pattern. As a result, the extended downfall could possibly plunge to the $0.34 demand zone.

On a contrary note, if the coin buyers manage resistance trendline breakout, it will indicate the trader's sentiment from selling on rallies in flipped to buying on the dip. Thus, the potential rally may reach $0.67.

Technical Indicator

The daily RSI dives deeper into bearish territory, indicating the sellers are strengthening their grip over the coin. Moreover, the increasing gap between the MACD and signals shows sustained selling activity from traders.

Therefore, the technical indicators reflect growth in selling pressure. As a result, the ADA technical analysis supports a bearish viewpoint and suggests selling opportunities with the pattern breakdown.

Resistance levels- $0.5 and $0.57

Support levels-  $0.43 and $0.38