Cardano price closes over the tough resistance of the 2018 high on a weekly basis.
At $1.58, the 10-week simple moving average (SMA) emerges as new resistance.
A low ADA volume profile indicates a dearth of buyers rather than vendors.
For much of 2021, Cardano’s price has been oscillating around the 2018 high, either hitting resistance or support. As a result, last week’s weekly closing over $1.40 was a bullish departure from the daily rejections that dominated trade in June’s final week. Nonetheless, the bullish event’s lack of volume, as well as no follow-through this week and a significant layer of resistance around $1.55, may point to a swift reversal of fortune for ADA.
Unlike many other altcoins, Cardano’s price increased by 16 percent in the second quarter. However, for the second quarter in a row, the digital asset failed to end above the 2018 ADA high of $1.40, underscoring the significance of the price level.
With a weekly finish above $1.40 last week, Cardano price reclaimed the 2018 high, and ADA storylines are optimistic for the first time in over a month. Despite this, the event was not driven by a surge in interest in the altcoin, since volume was only 25% of the 50-week average.
Despite the technical breakthrough, Cardano price action has reinforced the lackluster interest in ADA with little follow-through, demonstrating that there is no stampede to join the prospective new rise. To put it bluntly, FOMO has not engulfed cryptocurrency.
A new layer of resistance set by the 10-week SMA at $1.58 and the price congestion around $1.55 that dates back to February is adding pressure to the bullish Cardano price narrative. Continuing the rise into the tactically crucial moving average would result in a gain of only 12% from current levels.
The outlook for ADA remains neutral, with new, credible resistance weighing on the price of Cardano, as well as a lack of demand above $1.40. A dip below the 2018 high would not be surprising, and it is expected in the current environment.
The $1.20 level of support, which corresponds to the June 27 and July 1 lows and represents a 14.5 percent drop from the current price, is a good place to start. Additional ADA weakness will not be prevented until the psychologically significant $1.00, resulting in a 30% drop.
Weekly ADA/USD chart
A weekly closure above the 10-week SMA would change the price structure and open up a fresh, long-term investing opportunity for ADA investors./n
