Cardano (ADA) Faces Critical Sell Signal: Crypto Analyst Raises Alarm
February 23 2024 - 11:00AM
NEWSBTC
In a recent technical analysis by crypto analyst Ali Martinez,
known on social media as @ali_charts, a potential sell signal has
been identified on the three-day chart for Cardano (ADA) against
the US dollar. This analysis, shared on X on February 23, suggests
caution among ADA traders due to the appearance of a bearish signal
from the TD Sequential indicator. Martinez’s chart showcases the TD
Sequential indicator presenting a ‘9’ signal, a classic sell
indication that suggests the current trend may be exhausted and a
reversal could be imminent. This signal is highlighted on the
candlestick that has been forming over the last three days, marked
by a red rectangle surrounding a green candlestick. Related
Reading: Bitcoin Millionaire Takes A Shot At Cardano For Being A
‘Wannabe Ethereum’ – Details The ‘9’ setup, traditionally seen as a
sign to take profits or to prepare for a trend change, implies that
ADA’s recent upward momentum may face a setback. The analysis
further notes that this is not the first instance of such a signal
appearing on Cardano’s chart. Previous occurrences of the TD
Sequential ‘9’ sell signal were followed by price corrections for
ADA. Traders may be particularly vigilant now, as the chart
indicates that the last two signals of this nature were succeeded
by downward price action. Martinez remarked: The TD Sequential
indicator shows a sell signal on the #Cardano 3-day chart. It’s
important to note that the last two times this indicator signaled
bearish, ADA experienced a price correction! How Low Could Cardano
(ADA) Price Retrace? As of February 23, 13:06 UTC, the ADA/USD pair
shows a complex interplay between bullish and bearish signals on
the daily time frame. The chart presents a constricted pattern
following a descent from a local high. Related Reading: Cardano
(ADA) To Break $8 In Bull Run: Analyst Predicts Timeline The ADA
price is currently trading at $0.5790. Importantly, the price is
above the 20-day Exponential Moving Average (EMA) at $0.5733, the
50-day EMA at $0.5462, the 100-day EMA at $0.5065 and notably, the
200-day EMA at $0.4487. The positioning above these EMAs can be a
sign of an underlying bullish sentiment in the market. The
Fibonacci retracement levels, drawn from the peak to the trough of
the recent move, highlight significant levels of potential support
and resistance. The 0.236 level at $0.5866 is immediately overhead,
acting as a minor resistance level. The 0.382 level at $0.5203 and
the 0.5 level at $0.4667 are key support zones to watch if a
bearish reversal occurs. A break below these levels could signal a
deeper retracement towards the 0.618 level at $0.4131 or even the
0.786 level at $0.3368. However, the most crucial support at the
moment is the 20-day EMA which could forebode a changing trend.
Notably, the volume has been relatively consistent, with a slight
decrease in trading volume accompanying the recent price
consolidation. This could indicate a lack of conviction among
traders. Confirming this, the Relative Strength Index (RSI) is at
54, indicating neither overbought nor oversold conditions. The RSI
trend is neutral, providing no clear directional bias at the
moment. In conclusion, while there are hints of bearishness, there
are still good arguments to be bullish on Cardano and not wait for
a larger correction. However, if the price does not hold above
several key EMAs on the daily chart, the trend change could be
confirmed. Featured image created with DALL·E, chart from
TradingView.com
Cardano (COIN:ADAUSD)
Historical Stock Chart
From Jul 2024 to Aug 2024
Cardano (COIN:ADAUSD)
Historical Stock Chart
From Aug 2023 to Aug 2024