September 22, 2023
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Cardano pares most of its Q1 losses as ADA rebounds 60% in a month — What’s next?

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ADA price is now in a notorious selloff area that coincided with the price crashing by 40% in January 2022.

Cardano (ADA) inched higher on March 25, putting itself on course recoup a great portion of losses that it had incurred in the first two months of this year.

Cardano: not so bullish yet?

ADA’s price jumped by around 7.5% in trading Friday, reaching $1.19 over a month after bottoming out at around $0.75. The Cardano token’s huge rebound move netted around 60% in gains. Nonetheless, it remained at the risk of losing its upside momentum in the coming weeks.

At the core of this bearish analogy is a multi-month descending channel pattern, with a reliable track record of causing and limiting ADA’s rebound attempts simultaneously since September 2021.

The channel’s upper trendline particularly has served as an ideal selloff zone, now being tested again as resistance, as shown in the chart below.

ADA/USD daily price chart. Source: TradingView

ADA’s daily relative strength index, now at 71.80, also alerts about its “overbought” nature. In a perfect scenario, an RSI reading above 70 leads to selloffs in an attempt to neutralize the underlying asset’s excessive valuation. That puts the Cardano token at an imminent pullback risk toward the descending channel’s lower trendline.

More signs of ADA’s potential pullback move come from its weekly charts. Notably, the Cardano token’s rebound has been having it test its 20-week (near $1.21) and 50-week (near $1.31) exponential moving averages (EMA) as resistances. They were instrumental in capping ADA’s gains in January 2022. 

ADA/USD weekly price chart. Source: TradingView

Alex Benfield, analyst at Weiss Ratings, said ADA needs to reclaim $1.20 as support, a level that kept its bullish bias intact multiple times in 2021. He noted that if the Cardano token manages to do so, its likelihood of seeing a medium-term rally will be higher, adding:

“Until it clears that resistance, this move is in danger of losing momentum,” 

ADA “fundamentally bullish”

Alexander Mamasidikov, co-founder of crypto wallet service MinePlex, believes Cardano’s interim outlook is bullish despite its overbought risks.

Related: Charles Hoskinson cheekily admits: ‘I was wrong’ about DApp rollout

The executive believes that ADA’s ongoing growth momentum is more fundamental than technical, noting that the token started spiking after it became one of the assets included in the Grayscale Investment’s new altcoin fund, dubbed Smart Contract Platform ex Ethereum fund (GSCPxE).

“The growth is proof of how impressed investors are with respect to the revolutionary role of the Cardano blockchain in the fast-growing smart contract-powered evolution of Web3.0,” Mamasidikov asserted, albeit agreeing that levels near $1.50 could play spoilers to ADA’s upside move. Excerpts:

“Drawing from ADA’s growth trajectory, the $1 price level remains the crucial support level while the coin’s resistance is pegged at $1.5 in the short to medium term.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Biggest Movers: DOGE, ADA Nearly 10% Higher, as AXS Leads Today’s Gainers

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DOGE was higher during today’s session, as it was reported that a Bitcoin ATM operator added the token to its Kiosks. This comes as cardano also added to recent gains, after it was revealed that Coinbase is now offering cardano staking. Despite this, it was axie infinity (AXS) that led Thursday’s gainers. Axie Infinity (AXS) […]
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Bitcoin, Ethereum Technical Analysis: ETH Falls Below $3,000 as Crypto Gains Encounter Resistance

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Gains in cryptocurrencies slowed down on hump-day, as bitcoin and ethereum prices hit resistance levels. ETH fell below the $3,000 level, with BTC falling below its long-term ceiling of $42,500 during today’s session. Bitcoin The global crypto market cap was 0.69% lower as of writing, as gains in BTC eased on Wednesday, and prices encountered […]
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Internet Computer eyes 50% move as ICP enters 'falling wedge' breakout territory

Internet Computer eyes 50% move as ICP enters ‘falling wedge’ breakout territory

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ICP price is likely to face strong resistance at its 50-day exponential moving average right under $20.

The price of Internet Computer (ICP) reversed directions after falling to its record low near $14.50 on Feb. 24 and has rebounded by more than 30% ever since. And now, it appears the 35th-largest digital asset by market capitalization has more room to grow in the coming weeks.

ICP breaks out of ‘falling wedge’

ICP’s daily chart shows a falling wedge pattern — a setup consisting of two descending, converging trendlines connecting lower highs and lower lows. The intersecting nature of the two lines indicate a weakening bearish momentum. As such, traditional analysts anticipate a breakout out of a wedge to be bullish.

For ICP/USD, the wedge hurdle was near $17.75, as shown in the chart below. It broke above it on March 22, and kept on rising in the next daily session, accompanied by an increase in trading volumes. On the whole, it shows a convincing falling wedge breakout in action.

ICP/USD daily price chart featuring a ‘falling wedge’ setup. Source: TradingView

In a “perfect” scenario, breaking out of a falling wedge pattern — to the upside — can see a subseqeunt price rally by as much as the maximum distance between the wedge’s upper and lower trendline. That may put ICP en route to over $27 — by almost 50% — sometime by April.

Nonetheless, there is also a possibility that ICP’s breakout mode exhausts midway near $20, a level that coincides with the resistance trendline of its multi-month descending channel. Still, it would leave the Internet Computer token with a potential 20% upside setup before the next pullback occurs.

Bearish risks remain for ICP price

Falling wedges are poor performers when it comes to predicting bullish chart patterns, according to  Tom Bulkowski, a veteran stock market investor, who noted that they work well when predicting a  “downward breakout in a bear market.”

ICP has been in a bear market since its launch in May 2021 across the crypto exchanges, with its price plunging more than 90% from its debut rate of around $240 (data from Binance). The token dropped amid allegations that its founding company, DFINITY, dumped billions of dollars worth of Internet Computer tokens while simultaneously barring its early investors from exiting their positions.

Additionally, a correction across the Bitcoin (BTC) and the rest of the cryptocurrency markets also weighed down the ICP’s bullish prospects.

Notably, the correlation between Bitcoin and Internet Computer has been mostly positive since the ICP’s trading debut on exchanges. In other words, ICP typically sees downside moves when BTC experiences a correction.

ICP/USD daily price chart. Source: TradingView

Despite logging a falling wedge breakout, ICP still eyes further bullish confirmation as it trades below its 50-day exponential moving average (50-day EMA; the red wave) near $19, a strong resistance level since September 2021.

Related: Internet Computer founder‘s $250M plan to help end the war in Ukraine

Failure to mark a break above the 50-day EMA could have ICP retest its record low near $14, down over 20% from today’s price.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Terra price signal that preceded an 80% LUNA rally is back

Terra price signal that preceded an 80% LUNA rally is back

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LUNA price still risks correcting, however, with a weakening RSI and decreasing trading volume.

A technical setup that preceded a circa 80% price rally in the Terra (LUNA) market in August 2021 has appeared again.

LUNA paints bullish MACD crossover

The technical setup involves a so-called “signal line crossover” between LUNA’s weekly MACD line — equal to the difference between the token’s 12-week and 26-week moving averages (MA) — and the 9-week MA called the Signal Line, plotted above the zero line, as shown in the chart below.

LUNA/USD weekly MACD illustration. Source: TradingView

Together, these lines represent Moving Average Convergence Divergence (MACD), a momentum oscillator to determine a market’s direction and momentum.

So, if the MACD line crosses above the signal line, markets interpret it as a bullish MACD crossover. Conversely, a bearish MACD crossover occurs when the MACD line falls below the signal line.

LUNA’s weekly MACD line closed above its signal line earlier this month, raising speculations about a strong bullish momentum ahead. For instance, independent market analysts “Argonauts” cited a similar bullish crossover from August 2021 that occurred before the Terra token’s circa 80% price rally — from $12 to $102.

Bearish divergence detected

The MACD-based bullish outlook in the Terra market also stems from LUNA’s incredible price performance in the last thirty days.

Notably, LUNA’s price has surged by nearly 90% after bottoming out at $47.25 on Feb. 20, now eyeing a run-up above $100.

Nonetheless, the Terra token’s strong upside move accompanies a decreasing momentum, as illustrated by its weekly relative strength index (RSI), and weakening trading volumes, suggesting bullish exhaustion is close.

LUNA/USD weekly price chart featuring price-momentum bearish divergence. Source: TradingView

Therefore, a pullback from levels near $100 could have LUNA retest its previous resistance-turned-support levels near $75.50 and $50, coinciding with the 0.236 and 0.5 Fib lines, respectively, of the Fibonacci retracement graph attached below. 

LUNA/USD weekly price chart featuring Fibonacci retracement support/resistance levels. Source: TradingView

LUNA price double-top risks

LUNA’s close above its previous record high of around $106 could have it enter unchartered territory with a Fibonacci retracement graph drawn from $102-swing high to $45.50-swing low, suggesting an extended upside move toward $138.

LUNA/USD weekly price chart. Source: TradingView

Related: ‘We’re already buying:’ Terra founder plans to obtain $10B BTC for reserves

On the other hand, a pullback move from levels near $100 could also trigger the classic double-top setup, which entails two high points in the market, signifying an impending bearish reversal signal. LUNA could paint one in the coming weeks, as shown in the chart below.

LUNA/USD weekly price chart featuring ‘double top’ setup. Source: TradingView 

In a “perfect” double top scenario, the Terra token would risk crashing by more than 50% to $44 on the next pullback, followed by a breakout move towards $19.50, also coinciding with LUNA’s 50-week exponential moving average (the red wave). 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Bitcoin, Ethereum Technical Analysis: ETH Stays Above $2,900 as Traders Eye $3,000 Ceiling 

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Ethereum remained above $2,900 to start the week, as the world’s second largest cryptocurrency consolidated its recent gains. Bitcoin was also consolidating, as it continued to trade above $41,000 during Monday’s session. Bitcoin Despite a selloff to end last week, prices of BTC continued to hover above $41,000 on Monday, as market bulls appear to […]
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Avalanche price can double by summer as AVAX's 20% weekly rally rekindles 'bull flag'

Avalanche price can double by summer as AVAX’s 20% weekly rally rekindles ‘bull flag’

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But a near-perfect correlation between Avalanche and Bitcoin so far this year could spoil the bullish outlook.

A sharp upside retracement in the Avalanche (AVAX) market this week has raised its possibilities to rise by another 100% in Q2.

Avalanche chart painting a ‘bull flag’

The bullish outlook primarily appears in the wake of AVAX’s multi-month bull flag setup, which formed after a strong price move higher to over $150, an all-time high in the Avalanche market. In detail, the setup is a downward sloping channel, denoted by two parallel trendlines against the previous trend, with volumes declining to underscore a weakening downtrend.

AVAX/USD weekly price chart featuring ‘bull flag’ pattern. Source: TradingView

In a perfect scenario, bull flags resolve with a breakout move above their upper trendlines, followed by an extended uptrend, with the profit target at length equal to the size of the underlying asset’s previous uptrend (also called flagpole).

That could have AVAX’s price to undergo a similar upside move in the coming weeks, beginning with a close above its interim resistance of 20-week exponential moving average (20-week EMA; the green wave in the chart above) and later with a breakout above the flag’s upper trendline.

As a result, AVAX may eye a run-up towards $157, up more than 100% from its current prices near $77.

AVAX price downside risks

The latest bout of buying in the Avalanche market has appeared largely due to its strong positive correlation with Bitcoin (BTC).

Notably, AVAX and BTC were moving almost perfectly in tandem at the beginning of 2022, with their correlation coefficient coming out to be between 0.90 and 0.99. However, as of March 17, the reading had corrected to around 0.79, still underscoring Avalanche’s continued preference of mirroring the benchmark cryptocurrency’s moves.

AVAX/USD and BTC/USD daily price chart featuring their correlation coefficient. Source: TradingView

Nonetheless, the correlation exposed AVAX to the same downside risks that Bitcoin has been facing since November 2021, including Federal Reserve’s quantitative tightening and the ongoing Ukraine-Russia conflict.

On March 16, Fed’s chairman Jerome Powell said that the U.S. economy is strong enough to bear higher interest rates as he announced the central bank’s first rate hike since 2018.

Meanwhile, Joel Kruger, a strategist at crypto exchange LMAX Digital, noted that the central banker’s hawkish tone could pressure Bitcoin into falling further away from its all-time high of $69,000.

“Rates going higher will strangle equity markets. So if we see a mass exodus out of risk assets, it’ll weigh on everything,” he told Bloomberg, stressing that Bitcoin could fall to $20,000, thus contributing “to a decline in crypto assets.”

Related: Avalanche aims to accelerate subnet adoption with multiverse incentive program

As a result, AVAX’s bullish outlook risks invalidation as long as it tails Bitcoin’s price accurately. That could mean a potential price pullback from its interim resistance level of around $80, coinciding with the 0.618 Fib line of the Fibonacci retracement graph drawn from $9-swing low to $152-swing high.

AVAX/USD daily price chart. Source: TradingView

If the correction occurs, AVAX’s next support line appears at the 0.786 Fib line around $64.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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3 reasons why Ethereum price can still retest $3K this month

3 reasons why Ethereum price can still retest $3K this month

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A mix of technical, fundamental, and on-chain indicators show ETH price could boom higher as Q1 winds down.

Ethereum’s native token Ether (ETH) could reach back to $3,000 in March, backed by a mix of short-term technical, fundamental, and on-chain catalysts.

ETH price paints “symmetrical triangle”

The first interim bullish outlook for Ether ironically comes from a bearish continuation pattern

Notably, ETH’s 50%-plus decline from its all-time high of around $4,650 on Dec. 2, 2021, followed up with forming a consolidation channel called a symmetrical triangle. Hence, the Ethereum token has been fluctuating between a falling upper trendline and a rising lower trendline since the beginning of this year.

ETH/USD daily price chart featuring symmetrical triangle. Source: TradingView

ETH/USD last retested the triangle’s lower trendline as support on March 14 near $2,500, following a sharp correction after finding sellers near the 20-day exponential moving average (20-day EMA; the green wave in the chart above). S

ince then, ETH’s price has rebounded by as much as 9.26%, closing above the 20-day EMA resistance on March 16 to reach almost $2,750. 

A decisive rebound move, accompanied by a rise in trading volumes, could have Ether eye the triangle’s upper trendline as its next upside target near $3,000.

The Merge 

On March 15, Ethereum developer Tim Beiko announced that they have successfully tested the “Merge” on the Kiln testnet, raising speculations that the protocol would completely switch from proof-of-work (PoW) to proof-of-stake (PoS) in Q2/2022. 

The euphoria around the Merge has acted as one of the main bullish prospects behind Ethereum’s growth since the introduction of its first consensus layer upgrades in December 2020.

Arcane Research noted in its latest weekly report that a total of 312,000 validators staked 10 million ETH on the Merge — also called Ethereum 2.0 — smart contacts.

That amounts to nearly $26 billion worth of Ether, more than 8% of its total circulating supply, now locked away. The prospects of more Ether going out of circulation, coupled with hopes of higher demand, have pushed its price up by nearly 360% from its December 2020 low of around $525 to date.

Lito Coen, the founder of Crypto Testers, a product comparison platform, anticipates Merge’s launch to have Ethereum’s daily emission rate slashed from 12,000 ETH a day to 1,280 a day, noting that the network’s “yearly inflation will go down from 4.3% to 0.43%” — equivalent of three Bitcoin halvings. 

Ethereum supply growth. Source: Lito Coen

“And the 0.4% inflation figure is without taking into account the automated ETH burn introduced by EIP-1559 ($5b burnt since launch) taking ETH burn into account Ethereum will be deflationary,” Coen wrote.

Positive divergence between utility and prices

A bullish divergence between Ethereum’s daily active addresses (DAA) and ETH’s price is also emerging, according to data from analytics platform Santiment.

Notably, Ethereum’s DAA fell but not as much as the prices, which dropped about 35% in the past four months. That indicated that users continued to interact with the Ethereum network for reasons beyond speculation and trading.

Related: How professional Ethereum traders place bullish ETH price bets while limiting losses

ETH active addresses divergence remains in the area where prices historically rise,” noted Santiment, while citing the chart below.

Ethereum DAA-price divergence. Source: Santiment

“This is a vote of confidence in Ethereum and a statement that it’s here to stay (and grow),” said Michael Pearl, COO of dapp developer Kirobo, adding that its growth in the DeFi space would boost ETH’s price even beyond $3,000.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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