- All the gains made in the final week of September were wiped out.
- The strong uptrend and buying volume has faded since the weekend.
As a seasoned analyst with years of market observation under my belt, I can’t help but feel a tinge of deja vu when I see Cardano [ADA] retreating from its recent highs. September, traditionally a month of gains, ended on a sour note, and it seems October is following suit. The selling pressure that has built up in the past few days is reminiscent of a stubborn storm cloud refusing to disperse.
On Friday, 27th September, Cardano (ADA) momentarily surged to approximately $0.416, but it subsequently pulled back from that level. Over the last four days, Bitcoin (BTC) has encountered a strong resistance zone, which has led to an increase in selling pressure due to growing investor concerns over recent tensions in the Middle East.
Previously, it was mentioned by AMBCrypto that the pessimistic market feeling might push ADA down below the $0.39 support zone. As anticipated, this trend occurred, causing the token to return to its middle price range.
Opportunity for swing traders
The Dynamic Momentum Index indicates that the bullish momentum has significantly weakened. The Average Directional Index (ADX, represented by yellow) is now below 20, while the Moving Average Convergence Divergence (+DI, represented by green) is dropping further down. Furthermore, On-Balance Volume (OBV) has decreased to a level that served as support in previous months, suggesting increased selling pressure.
As a crypto investor, I noticed that the price level (purple) of Cardano has returned to where it was in late July. The breakout attempt a few days ago seemed promising with substantial volume and positive momentum, but the sudden change in market sentiment caught us bulls off guard yet again.
However, moving back towards the intermediate price point presented a chance for purchasing. The aim is to reach the upper end of this range priced at $392. A protective stop may be placed slightly below the October 1st lows, around $0.342.
Cardano selling pressure could abate
Over the last fortnight, my observations have indicated a period of dormancy in market circulation. This dormancy, from a bullish perspective, suggested that a significant wave of selling might not be just around the corner.
As an analyst, I observed a descent of the 30-day MVRM (Maker’s Value Realized to Market Value Ratio) into negative territory. This shift suggests that the current spree of selling could potentially be winding down, considering the diminishing count of short-term holders who are profiting from their investments.
Read Cardano’s [ADA] Price Prediction 2024-25
In the past few hours, the retest and response at the $0.352 support level have been promising. The average age of the coin has gradually risen since August, hinting at an increase in Cardano’s hoarding.
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2024-10-02 18:15