Key Takeaways

Cardano is up 15.8% in the past 24 hours.
The upward price action allowed it to turn a significant supply barrier into support.
Now, ADA faces no opposition to retest the $2.47 all-time high.

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Cardano was recently on shaky grounds as it projected a 55% decline. Still, the recent break of a critical resistance level seems to have invalidated the bearish outlook and could lead to higher highs. 

Cardano Shrugs Off the Bears

Cardano is back in the green after printing a massive trend reversal pattern on its daily chart. In the last 24 hours, it’s up 15.8%. 

Trading veteran Peter Brandt has suggested that the head-and-shoulders formation that ADA has developed since mid-March has been invalidated. The bearish pattern projected a 55% downward target that could have taken the fifth-largest cryptocurrency by market cap to $0.45. 

A recent spike in buying pressure behind Cardano sent prices above the pattern’s right shoulder, negating the pessimistic outlook. Now, Brandt believes that ADA will remain bullish as long as the $1.25 support level continues to hold. 

New development in Cardano $ADAUSD The advance through the Jul 4 high goes a long way to negate the potential bearishness of the H&S top in this crypto. In fact, this price action can be viewed as bullish as long as price remains above 1.25

— Peter Brandt (@PeterLBrandt) August 10, 2021

Transaction history reveals that Cardano faces no opposition on its way to higher highs. 

IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model shows no significant supply barriers ahead for the asset. Based on this on-chain metric, the only considerable interest area sits between $1.88 and $1.93, where roughly 15,000 addresses have previously purchased 280 million ADA.

This resistance wall may have the ability to absorb some of the recent buying pressure. Holders who have been underwater may try to break even on their positions, slowing down the uptrend. But if Cardano can slice through this hurdle, it could climb and retest the $2.47 all-time high.

Source: TradingView

The IOMAP cohorts show that Cardano sits on top of stiff support. More than 100,000 addresses bought approximately 1.7 billion ADA between $1.56 and $1.61. This crucial demand zone suggests that bears will struggle to push prices down in the event of a sell-off, adding credence to the bullish thesis.

This news was brought to you by Phemex, our preferred Derivatives Partner.

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