What's up Twitter fam!? Congratulations to this week's #coinvote winners, who dropped a vote for Cardano and came out in first place! Let's get right to it! Looking at the four hour chart, you can see that ADA has made some nice advancements over the past week. It was able to surpass the 50 EMA (in orange) and the 200 EMA (in purple,) during a powerful week-long rally. In addition to surpassing the moving averages, it has managed to form a higher high and a higher low. The last major high was formed on 3/21, and the last major low was on 3/18. ADA has surpassed them both, and it appears to have formed a slight uptrend channel in the process. Furthermore, we can see that there has been a golden cross, as the 50 EMA has crossed above the 200.
If we focus on the rally in particular, we can see that it is holding a steep rising trendline (black dashes) as ADA charges higher. As you can see, ADA has alread pierced the top of the channel, thereby weakening it as resistance. Since then, ADA has returned to the rising dashed support line, and it is now attempting to rally higher off of that. Now that we're in this channel, and we appear to be approaching the top of it again, we need to keep a close eye on a few things.
1. Does ADA confirm a breakout above the black channel? If so, that would be a sign of incredible strength, and it would be a technical buy signal. 2. Does ADA fail to breakout above the black channel, and breakdown below the rising dashed trendline instead? If this occurs, the first level of support would be the rising 50 EMA, as it converges with the tops formed around teh .225 area. Below that, the midline of the channel and the 200 EMA would be the next significant area of support.
Looking at the immediate action, you can see that there is a resistance level at 0.256502. That's an important level, because it extends from the low of 2/6. ADA was just above it, but quickly fell back below. Now, we appear to be defining it as overhead resistance. So, within the next 24 hours, we're either going to break above the 0.256502 level, and test the top of the channel, or we're going to break down below the rising dashed support, to test the aforementioned downside support levels.
Keep in mind that ADA could fall clear down to the bottom of the channel, and still be in a technical uptrend. Also, as a general rule of thumb, just underneath the top of the channel is not where you want to be a buyer. I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***