In the past 24 hours, Cardano (ADA) has experienced a significant price increase, soaring nearly 10%. This surge in value is supported by a notable rise in trading activity, with the altcoin's trading volume surpassing $1 billion. If this buying momentum sustains, Cardano could potentially reclaim its two-year high of $1.32.
BeInCrypto's analysis reveals that Cardano has been constrained within a descending triangle since reaching a two-year peak of $1.32 on December 3. This bearish structure occurs when the asset forms lower highs yet maintains a horizontal support level, suggesting heightened selling pressure from traders capitalizing on gains.
In recent developments, ADA's price has touched the upper boundary of its descending triangle, signaling a possible breakout. This movement indicates a potential retest of resistance, often seen as a signal for bullish reversal if surpassed.
The ADA daily chart further supports this outlook. The coin's Elder-Ray Index has shown a positive value for the first time since December 13, reinforcing the bullish sentiment with a reading of 0.057.
ADA's Elder-Ray Index, which measures market bullish and bearish strength, shows a positive value for ADA, highlighting dominance by buyers and rising prices. Meanwhile, the MACD line (blue) is edging past its signal line (orange), hinting at a bullish crossover and suggesting increasing upward momentum.
Currently priced at $0.92, ADA sits at the upper limit of its descending triangle. The ongoing buying activity suggests potential for a breakout that could elevate Cardano to its two-year high.
Conversely, an inability to surpass the $0.92 resistance might reinforce the existing downtrend, potentially reducing ADA's price to the $0.84 support level, thereby negating the bullish forecast.