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Cardano bulls target $1 resistance level before massive ADA rally begins

Analytics

www.fxstreet.com 01 March 2022 01:08, UTC
  
Reading time: ~2 m

  • Cardano price action is positioned for an explosive breakout above key resistance.
  • The $1 resistance level is the next target for bulls to break.
  • First upon a confirmed bullish breakout is the $1.30 value area.

Cardano price has rallied during the Monday trade session. The move comes after several solid weeks of sustained lower lows and part of a broader route that has lasted nearly six months. However, that trend is likely to change due to a combination of bullish reversal signals.

Cardano price reversal imminent, return to $1 and then $1.30 incoming

Cardano price action continues to display several indicators that point to, at the very least, a strong mean reversion to the $2 value area. The most crucial factor is a time cycle known as the Gann Cycle of the Inner Year.

One of the Fathers of Technical Analysis, W.D. Gann’s methods confuse and confound contemporary analysts, investors, and traders. The most critical factor in Gann Analysis is the focus on time. Time, Gann wrote, is the reason why markets move and trends change. The time factor affecting Cardano is one of Gann’s cycles.

Cardano is inside one of the most powerful divisions of the Cycle of the Inner Year – the 180-day cycle. Gann wrote that any instrument trending strongly for 180-days faces a very high probability of a trend reversal or strong corrective move. Consequently, March 1, 2022, is the 180th day from the all-time high of $3.09 found on September 2, 2021. Additionally, March 1, 2022, is the beginning of a New Moon lunar phase – another important time event in Gann Analysis.

ADA/USD Daily Ichimoku Kinko Hyo Chart

Combined with the extreme oversold nature of Cardano price, the new all-time low on the monthly Composite Index, and the massive gaps between the bodies of the candlesticks and the Tenkan-Sen, Cardano is poised for an explosive move higher. Therefore, the first target that bulls will test as resistance is the critical psychological $1 level. The 50% Fibonacci retracement and daily Kijun-Sen share the $1.

Ultimately, if bulls want to convert Cardano into a clear new uptrend, then Cardano price needs to complete an Ideal Bullish Ichimoku Breakout. That means Cardano needs to close at or above the $1.30 value area.  


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