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Cardano runs into a resistance zone, can ADA traders anticipate a pullback

Cardano runs into a resistance zone, can ADA traders anticipate a pullback

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Disclaimer: The findings of the following analysis are the sole opinions of the author and should not be considered investment advice.

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In the price charts, the price register has risen considerably in recent days. The possibility of a sharp Bitcoin pullback [BTC] threatened the idea of ​​Cardano’s additional benefits [ADA]. Cautious traders can wait for a strong trend to establish and trade in its direction. At the time of writing, the $0.49 area looked like strong resistance, while $0.44 and $0.46 were areas of support.

ADA- 4 hour chart

Source: ADA/USDT on TradingView

The four-hour chart rose to record lows in the past two weeks. It crossed the $0.46 mark a couple of days ago. ADA approached the resistance zone at $0.49 and this level has been key since early August.

Until the trading session closes above $0.49 on the H4 time frame, the idea would be to sell all retests of the $0.48-$0.49 mark. After that, a decline can be expected in order to get into long positions.

Reasoning

Cardano registers 11% profit per day, here is the support area where you can buy

Source: ADA/USDT on TradingView

The 1-hour chart and its indicators promised to be bullish in the short term. While a rejection of $0.48 could happen in the next few hours, the charts also showed the $0.455 area as a strong support.

The Awesome Oscillator (AO) rose to higher records from the previous trading day in response to Cardano’s recovery from $0.43. Accumulation/Distribution (A/D) has also advanced in recent days, forming higher lows.

The $0.49 resistance area can be used to take profits. A dip to the support area (cyan box) can be used as a buying opportunity.

Conclusion

Rejection at $0.49 does not require a sharp plunge. If Bitcoin can climb above the $19.6000 mark, ADA can also rise above the $0.49 mark. Due to the uncertain market situation, a small position size and low risk (0.5%) are recommended. $0.49 and $0.51 can be seen as resistance zones on the upside.



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