Market Analysis

Cardano (ADA) Technical Analysis: All Coins in The Red, How Will ADA Survive This Bear Market?

from Crypto Vest 5 years ago 0 0 908

The crypto market has suffered another deep depression today as the global market capital slided a further $30 billion, now well below the $200 billion mark. Bitcoin crashed beneath its psychological $6,000 level earlier this morning, Ethereum has plummeted far below the $300 base support and all other coins are experiencing double digit losses.

Cardano has not escaped from this whitewash either, falling below $0.10 for the first time since the middle of December 2017 despite the company’s founder, Charles Hoskinson, has released an earlier-than-scheduled announcement on the new Icarus reference project. The new release will include a Chrome plugin wallet akin to the MetaMask browser wallet, and will allow third parties to develop ADA wallets to increase Cardano’s outer ecosystem. The main advantage of a browser wallet is that users will no longer have to synchronise to a blockchain to perform wallet functions - drastically improving on speed and usability.

Will late support arrive in tune with today’s announcement to pull ADA out from under the rubble, or will the collapsing market continue to bury the asset deeper as investors seek shelter away from cryptocurrencies? Let’s take a look.

The story so far

Looking at the 3hr ADA/BTC chart we can see how today’s bear market has had an effect on the asset’s price. For a long time ADA was tracking inside a descending triangle pattern, similar to most other coins in the market. The base support sat at the 1,688 Sats level and had only been tested once this year during the steep bear market in March. This level was breached for the first time yesterday at 17:00 (UTC+1) when Bitcoin began to show increased instability and has declined practically vertically downward since.

At the peak of this morning’s bear market, ADA retraced down as low as the 1,425 Sats mark from the 1D opening price of 1,615 Sats (-11%), only 20 Sats short of our first major support area for this coin.

Over the last 8 hours, bulls have fought back to the upper 1,500 Sats support, which is now a pivotal level for the asset going forward today. A drop below this level could signal a strong bearish continuation, a rise above this level could be a sign of the market recovering.

The story now

Deciphering where the market is going to go next is going to be difficult. Indicators will be a good representation of where the market should go, but for the most part we have to take BTC market sentiment and gut instinct into account.

Looking at the indicators over 1hr candles we can see that the bearish ADA market is attempting to reverse:

We are still waiting for stronger confirmations to come from overlapping 13/34 EMAs or a bullish T/K crossing on the Ichimoku indicator. These two signals will help us make a much more accurate assumption that ADA is starting to reverse.

Bitcoin appears to equalizing right now, with bullish traders fending off a further drop. It has just recovered back to the $6,000 support and both the MACD and RSI are showing improvements. Be wary of bull traps at this stage though! It is very common for bear market corrections to look like reversals but it is still very likely that Bitcoin will continue to suffer in the short-term. There’s a lot of fud going around and until overall sentiment improves, the Bitcoin market will continue to struggle.