The Cardano price has erased all of the gains it made ahead of the Alonzo hard fork, but encouragingly, the ADA token is holding above $2.00, which suggests buyers are active on the dip. However, until Cardano (ADA) clears $2.28, it remains vulnerable to another round of selling.
On September 2nd, after a 200% six-week rally, Cardano’s native token, ADA, was trading at a record $3.16. Unfortunately, five days later, ADA was changing hands below $2.00, and despite attempts to recover, Cardano has improved just 7%, to $2.12.
Following the broad weakness in July, the crypto market as a whole posited impressive gains in August and early September. Bitcoin (BTC) rallied from $29,600 to over $50k, and many altcoins registered huge returns over the period. Cardano was one of the better performing cryptos, benefitting from improving sentiment and optimism surrounding the September 12th upgrade. The Alonzo hard fork ushered in a new era of smart contract functionality for Cardano, which in theory makes it a genuine rival to Ethereum (ETH). As a result, the Cardano price climbed from $1.00 in July to over $3.00 in September to become the third-largest cryptocurrency. However, despite the successful transition, ADA has sagged since and presently lacks clear direction.
ADA price Analysis
The daily chart shows two clear trend lines dictate the price action. The first, from the July low, provides support at $2.05. Above the market, a descending trend line from the September all-time high counters the support at $2.28. The rising trend is reinforced by several lows towards $2.00 and should be considered the dominant trend.
As long as the Cardano price stays above $2.05, the bull market remains intact. Furthermore, if ADA clears trend resistance at $2.28, it should extend towards the 50-day moving average at $2.46 and the former ATH at $2.51. In the event the price clears $2.51, a run at the record looks probable. However, if Cardano loses trend support at $2.05, the next stop is the 100 DMA at $1.88. furthermore, a deeper selloff could target the 200-day average at $1.66.
Cardano Price Chart (Daily)
For more market insights, follow Elliott on Twitter.