An analysis by crypto expert Nick Regan suggests that Cardano (ADA) may face bearish pressure in the short term, despite potential for a brief upward movement. Regan’s examination of ADA’s price action reveals a complex interplay of technical indicators and macroeconomic factors influencing the token’s performance.
ADA’s Price Action and Technical Indicators
Cardano’s price has lately fluctuated as noted by Regan. ADA tried a higher push on the 1-hour chart but ran up opposition at the 200-hour Exponential Moving Average (EMA). This rejection spanned $0.03397 to $0.0346.
Following the rejection, ADA underwent a bearish breakdown around 0600 hours, followed by a three-wave correction. This correction tested previous lows in the range of $0.03254 to $0.03287. The Stochastic Relative Strength Index (RSI) currently indicates overbought conditions on shorter timeframes, hinting at potential downward momentum.
Macroeconomic Factors and Market Sentiment
The U.S. Federal Reserve’s interest rate decisions have contributed to the broader market conditions affecting ADA’s price. These macroeconomic influences have fostered an overall bearish sentiment in the crypto market.
Regan maintains a bearish outlook for ADA, viewing the current price movement as part of a larger corrective phase. However, he acknowledges the possibility of a brief push to the upside before a more substantial bearish move occurs.
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Trading Strategies and Price Projections
Regan highlighted several profitable trading opportunities from previous price movements, including bullish divergences and successful breakouts above key moving averages. The current strategy involves watching for a potential upward push before considering short positions on ADA.
On a daily timeframe, Regan expects ADA to test lower levels, potentially moving towards the $0.025 range. The price currently sits below several key moving averages, further supporting the bearish trend. Despite short-term bullish momentum, declining volume and lack of buying pressure suggest ADA may struggle to maintain upward movement.
Regan advises placing stop-loss orders slightly above key resistance levels, specifically around $0.0365. He views the current price levels between $0.02563 and $0.04224 as attractive for dollar-cost averaging and building long-term positions, despite the short-term bearish outlook.
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