Bears target $0.290 amid recession fears

the main ideas:

  • ADA fell 2.60% on Thursday. A second bearish session saw the ADA sub-$0.300 revisited.
  • Economic indicators from China and the US, the hawkish Fed and the Nasdaq left the ADA in negative territory.
  • Technical indicators remain bearish, which indicates a possible return below $0.290.

And on Thursday, ADA was down 2.60%. After losing 1.91% on Wednesday, ADA ended the day at $0.300. Notably, ADA dropped below $0.300 for the second time since November 22.

A mixed morning saw ADA climb to an early high of $0.309. Failing to reach the first major resistance level (R1) at $0.314, ADA dropped to a late low of $0.297.

The extended sell-off saw ADA drop through the first major support level (S1) at $0.304 and briefly through the second major support level (S2) at $0.299. However, a late pullback towards $0.300 narrowed the deficit.

The silent IOHK leaves the ADA in the hands of Nasdaq

There were no updates to the Input Output HK (IOHK) Network to provide ADA guidance on Thursday. The lack of news left the ADA in the hands of US economic indicators, the NASDAQ index, and the broader crypto market.

US economic indicators from China and the US weighed on investor confidence in the wake of the Federal Reserve’s interest rate hike and FOMC’s expectations.

With the Fed predicting a more aggressive interest rate path to bring inflation to target, US retail sales figures have reignited fears of a US recession. In November, retail sales fell by 0.6%, compared to expectations for a decline of 0.1%.

Today, the focus will remain on the US economy, with US private sector PMI figures due later. While we expect price sensitivity to the stats, FOMC members’ talks and IOHK updates will likely have a larger impact.

Input Output HK releases its weekly development update today. An influx of projects on the Cardano network will support a bullish session.

ADA price action

This morning, ADA was unchanged at $0.300. The range-bound morning saw ADA climb to an early high of $0.301 before falling to a low of $0.299.

ADAUSD 161222 daily chart

Technical indicators

ADA needs a break of the $0.302 pivot to target the first major resistance level (R1) at $0.307 and Thursday’s high at $0.309. A return to $0.310 indicates a bullish session. But the ADA will need the broader market to support the afternoon session.

In case the rally continues, the bulls are likely to take a run at the second major resistance level (R2) at $0.314. The third major resistance level (R3) is located at $0.326.

If it fails to move through the pivot, the first major support level (S1) leaves $0.295 in play. In case of risk-driven sell-off, the second major support level (S2) at $0.290 should cap the downside. The third major support level (S3) is located at $0.278.

ADAUSD 161222 hourly chart

This morning, both the Exponential Moving Averages and the 4-hour candlestick chart (below) sent a bearish signal.

The ADA was below the 50-day moving average, currently at $0.309. The 50-day moving average has pulled back from the 100-day moving average, with the 100-day moving average pulling back from the 200-day moving average, giving bearish signals.

A move through R1 ($0.307) and 50-day ($0.309) would trigger the 100-day moving average ($0.313) and R2 ($0.314). However, failure to break above the 50-day moving average ($0.309) will put ADA under pressure. The 200-day moving average is at $0.324.

ADAUSD 161222 4-hour chart

Bears Target $0.290 on Recession Fears – Coinphony [SV]

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