- ADA was trading in a near classic breakout pattern and flashed several bullish signals
- Data on derivatives indicated a growing interest in ADA, but critical support levels and resistance levels can quickly alter its trajectory
Cardano [ADA] Registered a huge 270% rally from early November to early December before turning around at its long-term support trendline. Despite this pullback, however, the altcoin’s price action remained well above its 20/50/200-day EMAs — Underlining a strong bullish edge.
ADA’s short-term volatility may offer lucrative opportunities to traders as the broader markets are still in a teetering state.
Cardano: can it maintain its bullish edge
Source: TradingView, ADA/USDT
ADA has maintained a strong bullish sentiment by staying above its 20-day, 50-day, and 200-day EMAs— Reaffirming a strong bullish edge despite the ongoing consolidation.
The altcoin was trading in a bullish flag pattern on the daily timeframe at the time this article was written. This breakout could be confirmed by a close above the $1.03 support. Bulls may target the $1.21 area, located near the trendline’s long-term resistance.
A break under its support of $0.80 could invalidate bullish tendencies. If ADA drops below this support level, it may be pulled towards the 200-day EMA of $0.62 and stall uptrend.
As of press time, the Relative Strength Index (RSI) hovered at 52. It suggested a slight bullish movement. Buyers can regain immediate resistance by maintaining a position above the middle line.
ADA’s trading volume in 24 hours surpassed $1.7 billion. This represents a nearly 12% increase in price over the last day. Volume increases of this kind are usually ideal for setting up short-term trades.
Derivates data revealed THIS
Coinglass
According to the latest data, ADA’s derivatives Open Interest rose by 16.63% to $739.86 million – A sign that new positions have been flooding the market.
The overall Long/Short Ratio was close to 0,9755 indicating a neutral or slightly bullish position. However, exchange-specific rates (e.g. Binance ADA/USDT, at 2.6127), showed a strong bullish bias among some traders.
ADA and BTC have a strong correlation. Bitcoin’s sudden price movement could affect ADA. Cardano’s near-term trajectory.
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Source: ambcrypto.com
