Disclaimer: The information presented does not constitute financial, investment, trading or other types of advice and is the opinion of the author only
- ADA has been on the rise in price and could retest The previous support has turned into resistance at $0.2531.
- A drop below $0.2397 could invalidate the bullish expectations.
Cardano [ADA] It was range trading in late November 2022 before a downtrend in December 2022. However, the ADA bulls found strong support at $0.2441 and used it to start a rally.
At press time, ADA is trading at $0.2472, up 1.9% in the past 24 hours. If the bulls maintain their momentum, ADA could retest or surpass the previous support at $0.2472.
Read Cardanos [ADA] predict the price 2023-24
Cardano Resistance at $0.2531: Can Bulls Test It Again?
The decline of ADA from its mid-December trading range between $0.2531 and $0.2652 was watched by the $0.2441 support. If the bullish momentum consolidates, the rally could reach or retest the previous lower band and support at $0.2531.
The Relative Strength Index (RSI) has retreated from the oversold territory, indicating increasing buying pressure. In addition, the Money Flow Index (MFI) showed an uptick, which indicates a massive buildup of ADA coins due to their discounted prices.
Chaikin Money Flow (CMF) has recovered from the zero line and climbed above the zero line. This showed that buyers gained increasing influence in the market.
If the buying pressure increases, ADA could rise and retest the $0.2531 level. Risk averse investors can take profits at this point. The move above the previous trading range may be due to Bitcoin’s strong bullishness [BTC].
However, a break below $0.2397 will reverse the bullish expectations mentioned above. Such a downside trend could push ADA to settle at $0.2298.
How do So much ADA you can get for $1?
ADA has seen an improvement in demand in the derivatives market
According to Santiment, demand for ADA decreased in the futures market in mid-October, early November, and mid-December 2022.
At press time, demand has improved as Binance funding rates have slipped from negative territory and jumped into positive territory.
There was also a slight improvement in weighted sentiment, which indicates that investor expectations for the asset have improved. Could demand in the derivatives market and improved investor sentiment drive the upside?
However, investors should monitor the Bitcoin price performance to gauge the movement of ADA.