The Cardano price bounced back after crashing to $1.4964 in the overnight session. ADA is trading at $1.72, which is about 14% above its lowest level today. It has a market capitalization of more than $53 billion, making it the sixth-largest digital currency in the world.
What happened: Cardano declined sharply because of two main catalysts. First, yesterday, data by the Bureau of Labour Statistics (BLS) showed that inflation in the United States surged in May. The 4.2% increase was better than the median estimate of 3.6%.
Indeed, most analysts were expecting the prices to surge since many Americans have seen their bills rise. The prices of commodities used to manufacture products that many Americans consume like copper and corn have surged. Similarly, gasoline prices have jumped to $3 in some states. Therefore, there are concerns that the Fed will be forced to intervene earlier than expected.
The Cardano price declined because of the announcement by Elon Musk, who said that Tesla would stop accepting Bitcoins. That was a blow to the blockchain community because Tesla is one of the biggest companies in the US. Still, it is not clear the number of people who bought their cars in Bitcoin in the past few months.
Cardano price prediction
The four-hour chart shows that the Cardano price has been relatively volatile recently. Indeed, the Average True Range (ATR) has risen to the highest point on record. During this period, Cardano has struggled to move above its all-time high of $1.8300 and $1.500.
While it’s too early to tell, the currency seems to be forming a bullish flag pattern. In price action analysis, this is usually a sign of bullish continuation. Therefore, I am cautiously optimistic that the currency will rise above the all-time high. However, a drop below the overnight low of $1.49 will invalidate this trend.