Disclaimer: The information presented does not constitute financial, investment, trading or any other advice and is solely the opinion of the author
ADA triggered a bearish breakout.
The outstanding interest has fallen in recent days.
Like the other altcoins, Cardano [ADA] follows back Bitcoins [BTC] correction. ADA was down 12%, falling from $0.4620 to $0.3804.
However, the price action appeared to be holding steady above the $0.3804 support level at the time of writing.
Read Cardano [ADA] Price prediction 2023-24
However, interest rate fears loom as Fed watchers await the May 2-3 FOMC meeting. US stock prices fell last week (April 21) amid increasing macroeconomic headwinds, putting downward pressure on the crypto market.
ADA could break lower supports if the trend continues and BTC drops below $27k.
Will $0.3504 Hold?
Source: ADA/USDT on TradingView
ADA provided a bearish breakout of its ascending channel on April 20, extending the post-rejection decline to the price cap of $0.4620. At the time of writing, ADA was teetering near the dynamic 50-EMA (0.3865) support.
The daily chart’s RSI pulled out of overbought territory and faced rejection below 50. It shows that buying pressure has eased, but bulls fought to regain control. But the falling ADX (Average Directional Index) suggests a likely consolidation or further downtrend.
If it is the former, ADA could fluctuate between the $0.3804 – $0.4056 range. But if it is the latter, ADA could drop to $0.3581 or the dynamic 200-MA ($0.3516) support.
A break below the 200-MA could expose ADA to even more aggressive selling, sending it down to March lows of $0.3015.
As such, the above scenario could provide short opportunities with targets at $0.3581 and $0.3015. In particular, the $0.3015 target could offer the best risk reward, but could easily be invalidated by a bullish BTC.
A close above $0.4056 invalidates the above bearish statement. Such an uptick could push ADA back into the ascending channel.
The outstanding interest fell
Source: Coinglass
Is your wallet green? Account ADA Profit Calculator
ADA’s open interest rates (OI) peaked around mid-April, but then declined. The OI was just over $180 million at press time, compared to over $240 million in mid-April. It shows a drop in demand for ADA – a bearish sentiment that could favor sellers.
In addition, the long/short exchange ratio on the 12-hour time frame showed that sellers had little upside against bulls – again pointing to a moderately bearish outlook for the asset over the medium/long term. But a bullish BTC could reverse this trend and is worth following before making any moves.
Source: Coinglass
This post Cardano Triggers Bearish Breakout – Are More Short Profits Likely?
was published first on https://ambcrypto.com/cardano-inflicts-bearish-breakout-are-more-shorting-gains-likely/
