ADA/USD is near important support in early trading this morning, as a reversal produced late on Monday reminded crypto traders a bearish storm still exists.
ADA/USD displayed a strong selling reversal in late trading on Monday and sank to a price of nearly 50 and a quarter cents momentarily. In early trading this morning ADA/USD has climbed higher, but it remains within sight of important support levels. The lingering images of support junctures on charts should keep technical traders rather nervous, as they are served strong reminders that the long term bearish trend in the broad crypto market continues to create sudden declines.
ADA/USD is trading slightly above 52 cents as of this writing; yesterday’s high in Cardano was slightly below 56 cents. ADA/USD sank after touching this mark and its trading mirrored the results among its major digital asset counterparts as a selling wave developed across the board. Perhaps profit taking took place among traders who had been waiting for higher ground to be demonstrated so they could cash out positions.
Or more troubling, is the notion that durable resistance levels continue to shadow the crypto market. The highs generated yesterday may have been taken advantage of as a way to close positions, which had reached equilibrium and allowed traders to walk away from positions which had been weighing them down with losses.
ADA/USD offers traders an opportunity to engage in short term trading tactics. Nearby support around the 0.51750000 level could prove important, if this level proves vulnerable short term it could spark additional concerns that selling momentum will increase. The inability of Cardano and other major cryptocurrencies yesterday to hold onto near term highs may be the beginning of another serious leg down. While some bullish traders may believe ADA/USD has been oversold, skeptics who remain sellers may look at moves higher as a way to ignite selling positions.
The long term bearish trend remains intact in the cryptocurrencies and ADA/USD has suffered like its major counterparts. Speculators who have the courage to be sellers and pursue downside momentum based on the perception that current support levels will falter and lows seen on the 20th of May will be retested cannot be faulted. If ADA/USD breaks below current support and price velocity is strong, Cardano could challenge important depths quickly. Traders need to use take profit and stop loss tactics to make sure the price of ADA/USD does not surprise and harm them.
Cardano Short-Term Outlook
Current Resistance: 0.52670000
Current Support: 0.51720000
High Target: 0.53460000
Low Target: 0.50330000