Cardano (ADA) Generates Weekly Bullish Divergence for the Second Time in History

Cardano (ADA) broke out from a 307-day descending resistance line after both the weekly and daily RSI generated bullish divergence.

ADA has been decreasing since reaching an all-time high of $3.10 in Aug. The downward movement so far led to a low of $0.40 in May 2021.

The price has increased slightly since, but is still trading at $0.47. Measuring from the all-time high, the price has so far decreased by 47%.

The most interesting reading comes from the weekly RSI, which has generated bullish divergence (green line). The only other time the weekly RSI generated bullish divergence was in Dec 2019 and led to an upward movement of 135%.

However, the RSI is still following its bearish divergence trend line (black) and trading below 50. A breakout from this line would confirm that the bullish reversal has begun.

Long-term breakout

Similar to the weekly chart, the daily one provides a bullish outlook. The main reason for this is that the price has broken out from a descending resistance line that had been in place for 307 days. Breakouts from such long-term structures are usually a sign that the preceding trend is complete. 

Moreover, the daily RSI has generated a significant amount of bullish divergence (green line). 

If the upward movement continues, the closest resistance area would be at $0.78.

ADA retracement

The six-hour chart shows a potential double bottom pattern inside the $0.41 horizontal support area. The double bottom is considered a bullish pattern, meaning that it leads to breakouts the majority of the time. 

However, the price is still following a descending resistance line, which has so far caused three rejections (red icons). A breakout from the line would confirm the double bottom pattern and indicate that the price is heading upwards.

Cryptocurrency trader @altstreetbet tweeted a chart of ADA, stating that the price is likely to decrease towards $0.45.

Since the tweet, ADA has already reached the target. The entire decrease looks like a corrective A-B-C pattern (black). The pattern led to a decrease below the 0.618 Fib retracement level, but the price has reclaimed it since. 

If it manages to hold on above it, it would likely lead to a breakout from the aforementioned resistance line and higher prices.

For Be[in]Crypto’s latest Bitcoin (BTC) analysis, click here

The post Cardano (ADA) Generates Weekly Bullish Divergence for the Second Time in History appeared first on BeInCrypto.

Earning Passive Income With Crypto

Related Posts

Arsenal Loses Appeal Over Misleading Crypto Advertising

Premier League giants Arsenal F.C. have lost an appeal and been given a second warning by the U.K.’s Advertising Standards Authority (ASA) over the “misleading” marketing of…

Medieval Empires: Ertugrul To Ease Entry Into Web3 Gaming

In light of blockchain gaming’s advancement into the mainstream gaming industry, Medieval Empires: Ertugrul’s founding team attended the Blockchain Economy Istanbul Summit, the biggest blockchain event in…

Biggest Movers: ATOM Climbs to Highest Point Since May, While SOL Rises by Over 10%

Cosmos rose to its highest point since May earlier in today’s session, as crypto markets surged on Thursday. The global market cap is trading over 6.27% higher…

Task Force to Expedite Review of South Korean Virtual Asset Bills

South Korea’s top financial regulator has assigned a task force to “expedite the review process of bills on virtual assets,” said its chairman Kim Joo-hyun. The task…

Automobili Lamborghini’s Third NFT Drop is Here – “The Epic Road Trip”

Automobili Lamborghini is continuing its journey into Web3. The iconic brand is taking loyalists off-road and on a virtual mission that starts from the Moon, crosses space,…

Bitpay Reveals Prepaid Cardholders Can Get up to 15% Cash Back Rewards via Select Retailers

The Atlanta-based crypto payment services company Bitpay has announced that Bitpay’s prepaid cardholders are eligible for cash back rewards if they use their card with participating retailers….