Ad
The world's first bitcoin ico

Don't miss the 100x

Samurai dog BUY NOW

Cardano in a major uptrend as it aims for $1.4: Should you buy ADA now?

on Feb 9, 2021
Listen
  • Cardano is in a major uptrend since Friday.
  • ADA gained over 60% in these five days, ultimately aiming for $1.4.
  • The current price surge seems way overextended, and a pullback to $0.6 might be the most likely outcome.

Follow Invezz on Telegram, Twitter, and Google News for instant updates >

Cardano (ADA) was on an upward swing since Friday, with its price gaining over 60% in just five days. What’s the reason behind the current price increase, and should you buy some ADA now?

Fundamental analysis: Smart Contract viability increased Cardano’s positive outlook

Copy link to section

The fifth-largest cryptocurrency by market capitalization managed to post such tremendous gains due to its fundamental improvements, mainly its announcement of the Smart Contract launch on the Cardano testnet. On top of that, Cardano’s market position as the most decentralized cryptocurrency, as well as its future prospect in terms of Smart Contract creation and Smart Contract transfers from Ethereum to Cardano network seem incredibly bullish.

Cardano posted week-over-week gains of 55.80%, outperforming both Bitcoin’s 35.05% gain and Ethereum‘s %18.86 gain. The fifth-largest cryptocurrency by market cap currently boasts a market value of $21.16 billion.

At the time of writing, ADA is trading for $0.685, which represents a price increase of 85.58% when compared to the previous month’s value.

ADA/USD technical analysis: Cardano poised to reach its $1.4 all-time highs?

Copy link to section

The fifth-largest cryptocurrency by market cap is still in its uptrend, and if the bulls continue to post higher highs on heavy volume, ADA might reach as high as $1.4. In the meantime, its main resistance is the $0.7265 recent high as well as the area around $0.8.

Featured Broker

Looking to invest?

Invest globally in stocks, options, futures, currencies, bonds and funds from a single unified platform, with our highest-rated broker.

Ad

Cardano’s current move seems very overextended and unhealthy, and many technical analysts are calling for a pullback. However, Cardano’s network upgrades and its long-term perspective might prove them wrong. Ultimately, traders will need to watch for volume rather than the price action, as the only way ADA will stop moving up is if bears reach exhaustion.

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.

ADA/USD daily chart
ADA/USD daily chart

ADA’s RSI on the daily time-frame has pushed into the overbought territory, and is currently deep into it. Its current value is sitting at 84.67.

ADA/USD 1-hour chart
ADA/USD 1-hour chart

Zooming in to the hourly time-frame, we can see ADA’s volume descent as time passed (though its volume is still incredibly high compared to its pre-surge levels). The cryptocurrency seems to be very careful around the 21-hour EMA, while the 50-hour EMA provides strong support.

ADA’s current uptrend will be put into question if the cryptocurrency breaks the 50-hour EMA. In that case, traders may expect a pullback to the $0.6 area and a retest of the 23.6% Fib retracement level.

Ad

Learn to trade crypto easily by copying crypto signals & charts from pro-trader Lisa N Edwards. Sign-up today for easy-to-follow trades for tonnes of altcoins at GSIC.

0/10
Get signals
Cardano Crypto Trading Ideas