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Bulls target $0.350 to bring $0.400 into sight

techsm5

Key ideas:

  • ADA rebounded 7.22% on Sunday to end the day at $0.297.
  • Network news and a broad rally in the crypto market supported a bullish weekend.
  • Technical indicators are bullish, signaling a move back to $0.350.

ADA rebounded 7.22% on Sunday. Reversing a 0.36% loss from Saturday, ADA ended the week up 18.80% at $0.297. Notably, ADA tested resistance at $0.300 for the first time since mid-December.

A bearish start to the day saw ADA drop to an early low of $0.274. Avoiding the first major support level (S1) at $0.272, ADA hit a last-hour high of $0.299. ADA broke through major resistance levels to end the day at $0.297.

Network News, ADA Adoption and NASDAQ provide support

There is a change in investor sentiment towards the Cardano and ADA network in 2023. The recovery in demand comes despite the lack of weekly updates on the development of Input Output HK. At the end of 2022, the number of projects disappointed, leading to a decline to a low of $0.239 as of December 30, 2022 for the calendar year.

However, a series of network updates and news of increased ADA adoption gave a breakout start to 2023. Prior to today’s morning, ADA was up 20, 73% year-to-date through Sunday’s close of $0.297.

News of founder Charles Hoskinson’s health clinic accepting ADA for payments followed ADA’s entry into the top ten most used cryptos. Last week, a CoinGate report drew attention to the increased use of ADA through 2022. According to the report, ADA entered the top ten most used cryptos for the first time.

The impending launches of two algorithmic stablecoins on the Cardano network are also bullish.

For investors, the missing piece of the puzzle is the lack of an influx of new projects after Vasil’s hard fork. However, Charles Hoskinson is optimistic that the numbers will increase rapidly in the first quarter of 2023.

Looking at the Total Value Locked (TVL) numbers, these are also bullish. Over 24 hours, TVL is up 19.45% this morning, according to DeFi Llama. Year-to-date, TVL is up 33.51%.

TVL 091222

The NFT stats also caught the eye, supporting the bullish price action. On Sunday, Cardan-NFT transaction volumes stood at 1,694.3 million ADA. While trading volumes are down from a 30-day high trading volume of 1,870.2 million ADA, trading volumes have been on an upward trend since mid-November.

Gimbal NFT 091222

Today, network updates will remain the main driver, although broader crypto market sentiment should remain bullish to support current price levels. The NASDAQ index and chatter from FOMC members will influence the afternoon session.

ADA Price Action

This morning, ADA was up 10.77% at $0.329. A bullish start to the day saw ADA rise from an early low of $0.296 to a high of $0.346.

ADA broke through the major resistance levels before falling back into the third major resistance level (R3) at $0.340.

ADAUSD 090123 Daily Chart

Technical indicators

ADA needs to avoid a drop through R2, R1 and the $0.290 pivot to retarget the third major resistance level (R3) at $0.340. A move back to $0.340 would signal an extended breakout session. However, the broader crypto market and Cardano news must support a bullish session.

In the event of an extended rally, the bulls will target a breakout of $0.350 to bring $0.400 into view.

A drop through R2, R1 and the pivot would bring into play the first major support level (S1) at $0.281. Barring a large-scale crypto selloff, ADA is likely to avoid below $0.280 and the second major support level (S2) at $0.265. The third major support level (S3) is located at $0.240.

ADAUSD 090123 Hourly Chart

This morning, the EMAs and the 4-hour candlestick chart (below) sent a bullish signal.

ADA was above the 200-day EMA, currently at $0.277. The 50-day EMA moved closer to the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A bullish cross from the 50-day EMA to the 200-day EMA would support a breakout of R3 ($0.340) to put $0.400 in play. However, a drop through the major resistance levels and S1 ($0.281) would give the bears a run at the 100-day ($0.268) and 50-day ($0.271) EMAs. A drop through the 50-day EMA ($0.271) would send a bearish signal.

ADAUSD 090123 4 hour chart


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