Cardano, Possible Head And Shoulder Forming In The Range!

Hello, Traders Investors And Community, welcome to this update-analysis where we are looking at cardano 4-hour timeframe perspective, the recent events, the current formation forming, what to expect next times and how to handle upcoming situations properly. Cardano was in a strong and significant uptrend where it approached the huge 12-month-resistance above in which it firstly failed and formed a pull-back which was expected after approaching such a huge resistance, now it is important to know if cardano already finished its correction or if there is more downside to come. In this case I detected a meaningful formation possibly currently establishing which can lead Cardano in a decisive and strongly volatile breakout that will determine the further outcomes.

Looking at my chart you can watch there that cardano just bounced to the downside from its huge 12-month-resistance where it consolidates since beginning of July to form the possible head and shoulder formation with the neckline marked in blue and the left should together with head already formed, such formation normally considered as top-formation which confirm with a break of the neckline to the downside in high bearish selling pressure but this is not every time the case as these formations sometimes have the bullish strength to confirm to the upside. But as cardano has still strong resistance above the bearish case is currently the more probable which will confirm with the right shoulder forming further on lower volume and a final break of the neckline.

Bullish + Bearish Ranges (4-Hour Timeframe):

Comparing cardano to other meaningful currencies it is establishing a longer sideways range here as others made already new highs Cardano is staying in the range established this can be another indication that the resistance is stronger and the head and shoulder confirm bearish. The unlikely bullish case will confirm with a entering of bullish volatility to test the 12-month-resistance and finally a close above the dashed grey trendline you can watch in my chart which can provide the bullish continuation but the bulls definitely need to show strength to play this out, as the bearish scenario is much more likely it will play out with a possibility of 65 % whereas the bullish with 35 %, in this case, it the best to wait on more signs validating the theory.

Taking all these factors into consideration we should not keep the bearish scenario out of sight as it can possibly play out here in form of the head and shoulder confirmation to the downside, such situation happened many times in the past and where people became bullish and after that trapped to the downside this does not mean it has changed already but empirically speaking this can definitely happen also as it is a short time to correction such big up moves before more further to the upside, in this case, the next times will show if Cardano has the strength to hold the level or the more likely bearish head and shoulder scenario shows up, in either case it is important to be prepared to not get overwhelmed when it happens.

In this manner, thank you for watching the analysis, support for more market insight and all the best my friends.

Information provided is only educational and should not be used to take action in the market.