In recent developments, Cardano (ADA) has experienced a notable decline, dipping below the critical $1 threshold, marking a decrease of over seven percent in the past 24 hours. This drop has brought ADA face-to-face with a significant resistance zone, often referred to as the golden pocket. This zone lies between $1.12 and $1.23 and has been a pivotal area on the weekly chart, where Cardano finds itself grappling to make a breakthrough.
The Golden Pocket Challenge
The price movement following the breakthrough above the 50% retracement level, which hovered around $0.82 to $0.83, aimed to propel Cardano toward the golden pocket. We are now witnessing how this resistance manifests, according to analyst Josh of Crypto World. This golden pocket is identified as a crucial Fibonacci zone, renowned for its strong resistance. Cardano’s recent rejection from this area aligns with expectations, suggesting that the cryptocurrency may continue to encounter resistance here in the short term. However, should Cardano succeed in surpassing this zone, the subsequent target would be the 78.6% Fibonacci level, approximately at $0.76.
Short-Term Price Action and Support Levels
In the short term, Cardano has experienced a pullback after achieving its flagpole price target within the bullish continuation pattern. The price correction has commenced, with key support levels currently being tested. Presently, support is evident around $0.97. Should the price fall below this, the subsequent support level is located at the 50% retracement, near $0.94. Furthermore, a short-term golden pocket support zone exists between $0.88 and $0.90.
If Cardano descends beyond this golden pocket, the next support levels to keep an eye on are $0.84 and the range between $0.76 and $0.77. These zones hold significance as potential bounce areas, reminiscent of the price actions observed in recent days.
Resistance Levels to Monitor
On the upside, Cardano is likely to encounter resistance between $1.15 and $1.17, with the most formidable resistance still residing within the golden pocket zone on the weekly chart. This area represents the primary obstacle for any bullish continuation. A successful breakout above this range could signal a further upward trajectory for ADA.
Conclusion: Navigating Cardano’s Path
As Cardano continues to navigate through these critical levels, traders and investors should remain vigilant. The interplay between resistance and support areas is shaping the cryptocurrency’s short-term journey. Whether ADA manages to overcome its current hurdles or faces further challenges will significantly influence its market trajectory. As always, staying informed and monitoring these key levels will be essential for those looking to make the most of Cardano’s price movements.
