fxstreet.com
- Cardano price is taking a breather by retracing to the immediate support levels at $1.03 and $0.97.
- This pullback will allow sidelined buyers to kick-start a 25% upswing to a yearly open at $1.31.
- A daily candlestick close below $0.971 will invalidate the bullish thesis for ADA.
Cardano price is experiencing a sudden surge in buying pressure due to the mini-crash observed in Bitcoin. Regardless of the correlation between ADA and BTC, the so-called “Ethereum-killer” was due for a quick retracement anyway due to its exponential rally.
Cardano price needs replenishments
Cardano price rallied 51% between March 18 and 28, setting up a swing high at $1.24. It is likely bulls faced exhaustion after this impressive run-up, and, as a result, AD dropped 10% to trade at $1.12.
While a recovery is likely, there is a chance for ADA to drop lower and retest the immediate support level at $1.03. Doing so will allow Cardano price to set a base before launching higher. As for the upside objective, the bulls are likely to target the yearly open at $1.31.
From $1.03, the move would constitute a 25% ascent and is likely where the upside is capped for ADA. However, if Cardano price decides to revisit the $0.971 support floor, the rally would constitute a 35% ascent.
ADA/USDT 4-hour chart
Additionally, the bullish thesis for Cardano price is completely dependent on Bitcoin’s directional bias. A surge in sell orders that triggers a flash crash for the big crypto will easily cross-contaminate Cardano and other altcoins.
So, a daily candlestick close below $0.971 will invalidate the bullish thesis for Cardano price, by undoing the 51% gains. This move would further sow seeds of doubt and trigger a potential crash to $0.86.