- Cardano is up almost 25% in the past week.
- Bullish momentum is building ahead of Cardano’s Vasil hard fork.
- Nevertheless, technical indicators suggest that ADA may retest before printing a new local high.
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Cardano is bound to increase profit-taking as it struggles to slice through tight resistance. Still, any potential corrections could be short-lived as speculation builds around the upcoming Vasil hard fork.
Cardano mounts a strong resistance
Cardano appears to be enjoying significant uptrend as the network nears the anticipated Vasil hard fork.
Cardano, the development firm behind IOHK, revealed that it successfully delivered a new node release for the upcoming upgrade. With the final testing process underway, the team of developers is assessing whether to release Vasil on the Cardano testnet. The goal is to “ensure that any changes do not adversely affect functionality for dApps already on the network.”
ADA is up almost 25% over the past week as it enters a final phase before the hard fork. It declined from a low of $0.54 on June 3 to a high of $0.66 yesterday. Now, it appears that Cardano may be bound for a brief correction before resuming its uptrend.
On the 12-hours chart, the 100 hourly moving average could act as a tight resistance to stop ADA from moving further. Meanwhile, the Tom DeMark (TD) Sequential Indicator is presenting a sell signal in the form of a green nine candlestick. Bearish formation expects one to four candlestick correction.
An increase in sell orders that pushed Cardano below $0.63 could serve as the first sign of validation of this bearish thesis. Falling below such critical support levels may encourage investors to book profits, which could add to the downside pressure. If this happens, ADA will drop by another 10% to $0.55.
Although the prospects appear to be in the bearish favor, Cardano will have a chance to invalidate the pessimistic outlook by cutting the 100 hourly SMA. Moving beyond this level and printing the 12 hourly candlestick above $0.69 could make ADA more likely to push towards $0.82.
Disclosure: At the time of writing, the author of this article holds BTC and ETH.
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