Amid the recent uncertainty in the crypto market, the Cardano price went sideways above the support trendline of the channel pattern. Over the past three weeks, market participants actively accumulated this dynamic support, which led to a bullish reversal in the daily chart. A bullish reversal from this trendline could, in theory, set a new recovery cycle that drives the coin price back to the overhead trendline. Is this the right time to enter?
A reversal within the channel pattern recuperates the bullish momentum in the Cardano price. A breakout above the $0.378 barrier offers a strong footing to continue the recovery rally forward. The intraday trading volume in the Cardano coin is $185.5 million, indicating a 4.9% gain. On May 28th, the Cardano price breached a horizontal resistance level of $0.378. After the bullish reversal from ascending trendline, this breakout of immediate resistance adds more conviction in long positional trade.
At press time, the Cardano price exchanged hands at $0.378 with an intraday loss of 1.1%. The red daily candle retests the breached resistance to ensure price sustainability at higher levels and offers an entry opportunity to interested traders. If buyers manage to hold above the $0.378 mark, the new recovery rally may push prices nearly 32% higher to reach $0.5 psychological resistance.
Under the development of a channel pattern, the asset price keeps bouncing off the parallel walking trendlines. Thus, if buying momentum persists, the aforementioned reversal from the lower trendline may push prices back to the above trendline situated near the $0.5 mark. However, this potential rally may face supply pressure near the $0.42 and $0.46 levels.
In terms of market sentiment, a bullish crossover between the DI+ (blue) and DI- (orange) slope indicates a bullish trend in the market. However, the downsloping ADX price reflects that bulls still lack strength, and new buyers must exercise caution regarding potential fakeouts.
With the recent price jump, the Cardano price reclaimed the daily exponential moving averages (EMAs) for 20, 50, and 100 days, which may surge as viable supports to lead further rallies. Overall, while there is potential for a price recovery to $0.5, investors must remain aware of resistance levels and market conditions to ensure the sustainability of long positions in Cardano.
Source: Coingape
