Coinglass data indicated that most market players shorted in ADA/USDT within the last 24 hours. Indeed, ADA exhibited bearishness on its lower timeframes, following a dip below the $0.45 mark. The coming days or two might see the altcoin testing $0.442 & $0.43 as support.
Meanwhile, investors and traders with long-term goals may need to watch the entire value area between $0.44 and $0.4. Bulls can anticipate bounces from this mark, though the charts don’t appear encouraging. Enthusiastic buyers may have to cancel their passion as September advances.
Cardano 1 Day Timeframe
The range between $0.644 and $0.442 had a mid-level of $0.543. The price has oscillated within the value area since May. Meanwhile, May-early June sessions witnessed surged volatility, with prices bouncing from range lows to highs. Nevertheless, recent weeks have seen this volatility cooling.
A move beyond the mid-range emerged through August, but bulls failed to follow their motives to push to $0.65. The $0.4 mark offered support during July sessions and a long-term foothold that remained substantial since January last year. Thus, this zone would be crucial in the coming weeks. A daily closing beneath this mark would trigger a sharp drop.
Reasoning
The daily RSI (Relative Strength Index) hovered at 41. Meanwhile, the swift fall from the support at $0.54 saw the indicator losing the neutral-50 in August. The alternative token lost a month’s gains within one week, whereas the momentum shifted to bearish.
The DMI (Directional Movement Index) also highlighted a massive downtrend, with the ADX (Directional Movement Index) and the –DI swaying beyond the 20 mark. Nevertheless, buyers appear unfazed regardless of this uninviting development.
The OBV (on-balance volume) soared steadily since June while recording multiple higher lows. Meanwhile, ADA purchased within the latest weeks far outshines the amount sold during the one week of massive losses.
Final Thought
Bitcoin has mimicked S&P 500 recently, though magnified. BTC encountered sharp rejection in its move to $24,000, reinforcing long-term bearishness. Cardano’s trend remained bearish, though a low-risk ‘buy opportunity could appear if ADA drops to $0.4, targeting the $0.54 area. A daily closing below $0.4 will invalidate this trade.